Fair Valuation of loan at below EIR

387 views 2 replies
Sir/Ma'am,
my client has a loan from its parent company @ 10% the interest of which is compounded quarterly and entire amount including interest is to be paid after 3 years. EIR is 12%.
Can you guide me with the Journal entries to take into effect this fair valuation.
Thank You
Replies (2)
Assuming loan amount 100000.
First calculate the fair value of loan which will be:
(100000×(1.025)^12))/1.12^3 = 95726.

Diff 100000-95726 = 4274 will be treated as income.

Then take loan anount Rs. 95726 and charge interest @ 12% on such loan for three years.

In fact, no difficulties will arise if you once figure out how to apply for a loan on the Internet. To begin with you should go to the website of the service that provides loans online and calculate the necessary term and amount of the loan at this page. The amount and term of financing are key that affect the final cost of your loan. This is followed by the process of filling out a registration application. It is not complicated, but it will be necessary for him to take about 15 minutes by filling out a number of contact and passport data. In the process of filling out a loan application, you may also be asked the phones of your friends or colleagues. This is done in order to protect their customers if they suddenly stole their passport so that could not get a loan for another person. After filling out the application, you will have the opportunity to sign the contract online. After signing the contract, money is transferred immediately to the card.

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
22 June 2026
Accountant

Global Image Technologies Private Limited

New Delhi

MBA

View Details
Company
25 June 2026
AUDIT MANAGER

JDAS & ASSOCIATES

New Delhi

CA

View Details
Company
10 June 2026
Senior Account Executive

JDS Advisory LLP

Ahmedabad

CA Inter

View Details
Company
29 May 2026
Finance Head

Bhawar Sales Corporation

Chennai

Graduate (Any)

View Details
Company
Featured 15 June 2026
Senior Auditor

N. Dhawan & Co

New Delhi

CA Inter

View Details
Company
24 June 2026
HEAD - AUDIT AND TAXATION

A R JADHAV AND ASSOCIATES

Mumbai

CA Inter

View Details
Company
01 June 2026
Audit, Taxation & Compliance Executive

R P S K & Associates

Nashik

CA Inter

View Details
Company
ARTICLESHIP 24 June 2026
CA Article Trainee

Rahul Dang & Associates

Pune

CA Inter

View Details