Interest on settlement
Enterprises to obtain short-term borrowings interest expense incurred, should generally be as financial expense, included in the income statement. Banks or other financial institutions at end of month settlement loan interest on a quarterly basis, quarterly for the first two months interest free. In accordance with the accrual principle, shall bear interest charges for the month, even if it did not pay for the month should also be treated as interest charges for the current month should be at the end of estimated amount of interest charges for the current month. Modest in the short-term borrowing, interest charges for the monthly burden small cases, each month of the year can also be a simplified accounting method, that is, actual interest payment month, treating them all as a monthly finance charges, debit "financial expenses" account is credited to "Bank" account. But in the end, if there is interest on borrowings should be borne by this year but not yet paid should be accrued, otherwise it will affect the annual income tax calculation. [1] Short-term borrowing interest payment terms: Interest on short-term loans settlement is divided into monthly payments, payment is due on a quarterly, half-yearly payments, and debt. If the enterprise's short-term loan interest paid monthly, is due in loan repayment of principal or interest when paid, and the amount is not big, you can actually pay or when a notification is received from the bank interest, directly recorded in the income statement. If short-term debt interest paid (quarterly), is due in loan repayment of principal or interest when paid, and a relatively large amount, in order to correctly calculate the profit/loss of the period, accrual approach should be adopted, first monthly accrued and included in the income statement, due for payment.
Contacts us

Phone: 0411-6724561

Fax: 0411-6724561