Church Loan

Can a member loan the church money? If so, how is the repayment amounts recorded in the books? I would like to hear your advice/comments.


Answer

I believe it would be handled the same as if the church had acquired a bank loan.

If you are using a double entry bookkeeping system, you would debit cash and credit notes payable when you first receive the loan. Then for the repayments, you would do the opposite: debit notes payable and credit cash.

If you are using a single entry bookkeeping system such as my spreadsheets, I would set up an expense account and record the repayments in it.

Hope this helps,



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