Will using bank deposits to pay off loans owed cause assets and liabilities to increase at the same time

Using bank deposits to pay off loans owed will not cause assets and liabilities to increase at the same time. When an enterprise uses bank deposits to repay the loan it owes, its assets and liabilities will decrease at the same time.

How to write accounting entries to repay loan interest with bank deposits

1. To repay loan interest with bank deposits, calculate it through financial expense accounts;

2. The specific accounting entries are:

Debit: financial expenses - interest expenses

Credit: bank deposits

3. Financial expenses refer to the expenses incurred by the enterprise during the production and operation process. Financing expenses incurred in raising funds. Including interest expenses (minus interest income), exchange gains and losses incurred during the production and operation period of the enterprise (some enterprises such as commodity circulation enterprises and insurance enterprises conduct separate accounting and are not included in financial expenses), financial institution fees, cash discounts or cash discounts incurred by the enterprise Cash discounts received, etc.

However, the interest expenses incurred during the preparation period of the enterprise shall be included in the start-up expenses; the borrowing costs incurred for the acquisition, construction or production of assets that meet the capitalization conditions shall be capitalized and shall be included in the "construction in progress" , "Manufacturing expenses" and other account accounting.

Extended information:

Loan interest rates and interest

The "General Rules for Loans" stipulates:

(1) Determination of loan interest rates: Loans The borrower shall determine the interest rate of each loan in accordance with the upper and lower limits of loan interest rates stipulated by the People's Bank of China, and specify it in the loan contract;

(2) Calculation and collection of loan interest: The lender and the borrower shall In accordance with the loan contract and the relevant interest calculation regulations of the People's Bank of China, interest will be collected or paid on schedule. When the extension period of the loan plus the original period reaches a new interest rate grade, the new term grade interest rate will be calculated from the date of extension. Overdue loans will be charged penalty interest in accordance with regulations.

(3) Interest discount on loans: According to national policies, in order to promote the development of certain industries and regional economies, relevant departments can subsidize interest on loans. For loans with interest discounts from relevant departments, the undertaking bank shall independently review and issue them and strictly manage them in accordance with the relevant provisions of the "General Rules for Loans".

(4) Loan interest suspension, interest reduction and interest exemption: Except as stipulated by the State Council, no unit or individual has the right to decide on interest suspension, interest reduction or interest exemption. Lenders shall handle interest suspensions, reductions and exemptions in accordance with the decisions of the State Council and within the scope of their duties and powers.