Hi Im Murthy,
I wanted to know the following:
If our company takes a short term Working capital loan on 1st May 2012 for a period of 90 days, The interest accrual as at 31st May should be the full amount of interest liability or only for May month?
Eg: Loan - USD 10,000 ; Interest rate 10% pa ; Tenor - 90 Days
In this case, on 31st May, my Accrued interest liability will be full amount till maturity ( or) only 1 month i.e., May .
Please advise.
Regards
PRK
Interest accrued by the end of May Month will be USD 83.33.
| Originally posted by : Chiradeep.R.H | ||
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Interest accrued by the end of May Month will be USD 83.33. |
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Hi Chiradeep, Are you sure it will be only 1 month liability?. Why should i not accrue complete 250? My actual liability will be Loan principal + complete interest till maturity right ? wont my liability will be understated? Can you please elaborate on why we should consider only 1 month interset as liability?
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
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