Definition of Interest Payable
Interest payable is the 游戏电竞线上外围APP v5.2 interest expense that has been incurred (has already occurred) but has not been paid as of the date of the balance sheet . [Interest payable does not include the interest for periods after the date of the balance sheet .]
Example of Interest Payable
Let's assume that on December 1 a company borrowed $100,000 at an annual interest rate of 12%. The company agrees to repay the principal amount of $100,000 plus 9 months of interest when the note comes due on August 31.
On December 31, the amount of interest payable is $1,000 ($100,000 X 12% X 1/12) and the company's balance sheet should report the following current liabilities :
- Notes payable of $100,000
- Interest payable of $1,000
Nothing is reported for the $8,000 of future interest.
The company's January 31 balance sheet should report the following current liabilities:
- Notes payable of $100,000
- Interest payable of $2,000
