Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 3 - No. 6)
When a bank loan is made in installments. How do you record subsequent loan repayments?
Debit bank account, Credit loan payable.
Credit bank account, Debit loan payable.
Debit interest expense, Credit bank account.
Debit bank account, Credit interest expense.
Explanation
When making loan repayments, the bank account is credited, and loan payable is debited.
Comments (0)
