Comments for Bank Loan

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Apr 20, 2011
Loan from Bank
by: Stephanie

Yes when a bank loan and loan interest payment is made, it is correct to post a credit to the bank and a debit to the Balance sheet account called bank loan payable and another debit to the income and expense account called Bank Loan Interest Expense.

The loan repayment portion does not impact the Income Statement only the interest paid each year that is deductible as an expense impacts the profit and loss statement.

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