Accounting entries for foreign currency loans
When settling foreign exchange (foreign currency converted into RMB)
Debit: Bank deposit (actual amount of RMB)
Financial expenses (the difference between debit and credit, if the debit is less than the credit, it is exchange loss, expressed in blue; If the debit is greater than the credit, it is the exchange gain, which is indicated in red).
Loan: bank deposit (RMB figures are calculated in foreign currency at the bookkeeping exchange rate)
When buying foreign exchange
Debit: bank deposit (RMB figures are calculated in foreign currency at the bookkeeping exchange rate)
Financial expenses (debit and credit balance, if the debit is greater than the credit, it is exchange gain, if the debit is less than the credit, it is exchange loss, expressed in blue).
Loan: Bank deposit (actual amount paid in RMB)
Financial expense accounting content
Financial expenses are the financing costs incurred by enterprises to raise funds needed for production and operation, including interest expenses (minus interest income), cash discount, exchange gains and losses, financing expenses, etc.
"Financial expenses" are accounted for in detail by setting up subsidiary ledger according to expense items. The financial expenses incurred by the enterprise shall be debited to the subject of "financial expenses" and credited to the subject of "bank deposits"; The interest income and exchange income of the enterprise offset the borrower. At the end of the month, all the financial expenses charged by the borrower will be transferred from the credit of the "financial expenses" subject to the debit of the "profit of this year" subject and included in the current profit and loss. After carrying forward the current service fee, there is no balance at the end of the "financial expenses" subject.
How to understand the exchange difference of foreign currency loan interest?
The exchange difference of foreign currency special loans refers to the exchange difference caused by the inconsistency between the borrowing date and the use date of foreign currency and the different exchange rates. Because foreign currency borrowing date, foreign currency borrowing date and accounting settlement date are often inconsistent, it is included in the cost of fixed assets.