Interest expense: Cash paid to lenders for the use of borrowed money

  • Most interest is a financing expense used for general operations
  • Some interest, such as interest in connection with construction, is capitalized and becomes a part of the overall cost of the asset
  • Interest is generated on debt from bonds, notes payable, and other company borrowings

K_10F_Interest_expense

Learn accounting with the free app

Accounting Flashcards

Accounting Flashcards includes a translate button for English, Chinese, and Spanish.

Learn financial accounting using beautifully illustrated flashcards, coordinated lessons, and rich audio. Whether you are an aspiring CPA or IFRS expert, use this accountancy app to reach your goals. Even an aspiring chartered accountant or those reaching for the CPA Australia can benefit. Topics of accounting standards, equation, terms, ratios, and more are covered.

iPhone6_mockup_truacur_smaller2

Get the PDF book here

Subsribe

 

« Back to Glossary Index