Most people may not understand it. The interest during the construction period mainly refers to the interest on fixed assets during the construction period of the project, mainly the loan interest and financing expenses incurred during the construction period to pay bank loans, export credits, bonds, etc. Next, the Legal Express Bian Xiao will show you how to calculate the interest during the construction period and where the interest is included.

1. How to calculate the interest during the construction period and where to include it? Interest during the construction period shall be calculated according to the loan requirements and conditions. Domestic bank loans are calculated as demand loans, and foreign loan interest is compounded at the interest rate determined in the agreement or loan letter of intent. In order to simplify the calculation, it is usually assumed that the loan is spent in the middle of each year, and the interest is calculated on a semi-annual basis in the first year of the loan, and on a full-year basis in other years. The calculation formula is: annual accrued interest = (accumulated loan principal and interest at the beginning of the year+current loan amount /2)× annual interest rate.

When the total amount of loans is evenly distributed in different years, the calculation of interest during the construction period can be considered as mid-year loans, that is, the loans in that year bear interest for half a year and the loans in the previous year bear interest for the whole year.