Ex and cum interest

48976 views 7 replies

can anyone expain what is ex-interest and what is cum interest with examples plzzzzzzzzzz

 

Replies (7)

In case an interest bearing financial instrument is sold ex interest, it means that the seller will be entitled to get the interest till the date of sales.  In other case where the instrument has been sold cum interest means that the interest till the date of sales also passed on to the purchaser.  Accordingly, the cum interest selling price is always higher than the ex interest price and the difference is usually is the interest accrued till the date of sale. 

In an ex-int transaction price does nt include the amt of interest bt in case of cum int price is inclusive of interest. So while doing the solution of an investment sum u shud first deduct the amount of intrest frm the price of cum int transaction and put that interest amt to intrst column. In case of ex int price does nt include the amount of intrst so just put the ex int amount in the cost column and int amt to the intrst column. The only diff between cum and ex is that in one price is inclusive of int and in another exclusive.

     These terms are used in connection with fixed interest bearing bonds/debentures.  Every company keeps a register of its debentureholders.  Ownership of the debentures keep on changing due to constant sale and purchase of debentures.  Before paying interest the company opens its register for the new owners of debentures to get themselves registered so that they could receive interest.  Now I will try to explain you the whole process with the help of an example.  For example a company has issued 100000 12% debentures of Rs100 each on which it is going to pay interest on 31/12/2015.  The company announces that those who want to receive interest on debentures may register themselves with the company by 30/10/2015.  

To read more please go to: https://www.jbsclasses.com/q2a_link/index.php?qa=1907&qa_1=what-is-the-meaning-of-ex-interest-and-cum-interest

In simple words,difference between the two is:-

Cum interest price : It means the interest price included in the principal amount

Ex interest price: It means the interest price will not include in principal amount

Ekhada example samza ke sakte kya
Ekhada example samza ke sakte kya

In simple ,

Ex - interest = Excluding Interest

Cum- interest = Including Interest

 

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
06 July 2026
Chartered Accountant (Indirect Taxation)

Gowra Ventures Pvt Ltd

Hyderabad

CA

View Details
Company
Featured 15 June 2026
Senior Auditor

N. Dhawan & Co

New Delhi

CA Inter

View Details
Company
06 July 2026
C.A./CA Inter OR pursuing C.A./GST/Accounts/Audit/IT - Head

Arvindkumar Maniar & Co.

Rajkot

CA

View Details
Company
29 June 2026
ACCOUNTANT

SANDEEP AASHISH & CO

Araria

B.Com

View Details
Company
ARTICLESHIP 09 June 2026
Article Trainee

Numbertree LLP

Mumbai

CA Inter

View Details
Company
ARTICLESHIP 24 June 2026
CA Article Trainee

Rahul Dang & Associates

Pune

CA Inter

View Details
Company
22 June 2026
Accountant

Global Image Technologies Private Limited

New Delhi

MBA

View Details
Company
24 June 2026
Chartered Accountant

CA Darshita Shah & Co

Nadiad

CA

View Details