Bank loan entry

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374 Points Posted on 29 September 2020
Loan borrowed for Rs.5000000 and all the installments have been paid but after last installment bank charged rs.20000 since some installments have been paid late now which account should I debit if I debit bank loan account then it shows Rs.20000 debit balance in that account.
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On 29 September 2020 at 21:10 Report
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Quick Summary
This discussion addresses how to record a late payment fee of Rs. 20,000 charged by a bank after a loan of Rs. 5,000,000 has been fully repaid. The consensus is to debit a 'Bank Charges/Late Payment Fees' account, which will ultimately be recognised as a finance cost in the Profit & Loss statement. This ensures the bank loan account accurately reflects a zero balance.

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student
216 Points Posted on 29 September 2020
Bank charges/late payment fees account which will be taken to p&l at the year end
1 Reply
On 29 September 2020 at 21:15
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CA
56 Points Posted on 29 September 2020
Bank charges for late payment account should be debited
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On 29 September 2020 at 22:00
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20 Points Posted on 30 September 2020
And I guess it will go under Finance cost in profit & loss statement
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On 30 September 2020 at 00:17

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