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View Full Version : Treatment of interest on loan


warzy
Mar 10, 2007, 09:19 AM
What is the correct accountring treatment of interest on partnesrs loan,i.e which account is to be debited and the account to be credited .

bunnyKutty
Mar 10, 2007, 12:10 PM
Debit Interest on Partner's loan account
Credit Interest payable account

When interest on loan is paid:
Debit Interest payable
Credit Cash