In order to solve the problem of insufficient funds, enterprises usually borrow long-term loans from financial institutions and pay corresponding interest according to regulations. So should long-term loan interest be accrued every month? How to make accounting entries?

Should long-term loan interest be accrued every month?

1. Long-term loans pay interest once a year. If they are expenses, they should be accrued once a month. Make the following accounting entries:

Debit: financial expenses-interest expenses

Loan: interest payable

2. Long-term loans pay interest once a year. If it is capitalized expenditure, the project does not need to be accrued on the premise that it is completed before the loan expires. The interest of the current year shall be paid by the bank, and the following entries shall be made:

Borrow: construction in progress -XX project-interest expense.

Loans: bank deposits

3. Long-term loans pay interest once a year. If it is capitalized expenditure, you need to accrue interest for several months of the current year on the premise of completing the project before the loan expires, and make the following entries:

Borrow: construction in progress -XX project-interest expense.

Loan: interest payable

How to amortize the interest adjustment of long-term loans?

Answer: If the underwriting fees and guarantee fees paid by issuing bonds are relatively large, they should be included in the subject of "bonds payable-interest adjustment".

Should be based on the actual issue price (the actual price received) debit "bank loans" subjects, according to the face value of bonds payable-face value "subjects, the difference between the two should be debited or credited" bonds payable-interest adjustment "subjects. Therefore, the amount of underwriting fees and guarantee fees paid by issuing bonds should be recorded in "bonds payable-interest adjustment" first, and then amortized according to the effective interest rate method during the holding period.

Amortization can be capitalized or expensed according to the specific use of bonds, and can be included in such subjects as "construction in progress, manufacturing expenses, financial expenses, R&D expenses".

Accounting treatment of long-term loans

What is a long-term loan?

Long-term loans refer to all kinds of loans borrowed by enterprises from banks or other financial institutions with a term exceeding 1 year (excluding 1 year). There are two main ways for enterprises to borrow long-term loans:

1. Deposit the loan in the bank and withdraw it at any time under the supervision of the bank;

2. The enterprise borrows money within the limit approved by the bank.

On the one hand, enterprises can make up for the shortage of liquidity by borrowing long-term loans, on the other hand, they can bring profit opportunities to investors.