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متابعة

How do you record the interest that is unpaid on a note payable?

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تم إضافة السؤال من قبل Rana Alnajjar , Web developer , Lebcards
تاريخ النشر: 2016/12/13
manseer muhammed ali
من قبل manseer muhammed ali , Accountant General , Royal Lighting L.L.C & Royal Furnishing LLC

Under the accrual basis of accounting, the amount that has occurred but is unpaid should be recorded with a debit to Interest Expense and a credit to the current liability Interest Payable. To illustrate, let's assume that a company's December loan payment included interest up until December 10.

Abdullah Aziz Eldain Morsi  Elgendy -        CMA  Candidate
من قبل Abdullah Aziz Eldain Morsi Elgendy - CMA Candidate , Regional Receivable Accountant , Amiantit Group of Companies

 AS per the   accounting  equation

owners equity = assets- liabilities

if the total liabilities  is more than the assets , the owner equity will be  negative   

Nazmul Islam CMA
من قبل Nazmul Islam CMA , Manager , Robi Axiatal Ltd.

Interest expense Dr.

 Interest payable Cr.

Majid Wangade
من قبل Majid Wangade , Senior Accountant , KANTOUR LIMITED COMPANY ( Real Estate, Construction and Asset Management )

Under the accrual basis of accounting, the amount that has occurred but is unpaid should be recorded with a debit to Interest Expense and a credit to the current liability Interest Payable

Ahmed mohsen
من قبل Ahmed mohsen , Senior Accountant , Main Poly Clinic

Notes Payable is a liability account that reports the amount of principal owed as of the balance sheet date. (Any interest incurred but not yet paid as of the balance sheet date is reported in a separate liability account Interest Payable.) The accountant has verified that the amount of principal actually owed is the same as the amount appearing on the preliminary balance sheet. Therefore, no entry is needed for this account.

Soliman Abd  ALmalak Gendy
من قبل Soliman Abd ALmalak Gendy , مدير ادارة مراقبة حسابات , الجهاز المركزى للمحاسبات

Interest   that is not unpaid is  referred  to an asset interest.

-under the accrual basis of accounting,the amount that has occurred but is unpaid should be recorded with a debit  to interest expense and to the current liability interest payable

Anil Lalwani
من قبل Anil Lalwani , Chief Accountant , Al Ahli Hospital

By way of passing a Journal entry as  debiting the Interest a/c and crediting the interest payable.

Wilfredo Quito
من قبل Wilfredo Quito , Accounting Manager , DDC LAND INC.

The journal entry should be debiting the Interest expense and crediting the interest payable.

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