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Hello again…
The question says that:
On trial balance :
loan from bank (4%) – 12 000 000Additional information:
A 25 year bank loan was taken out on 1 August 2012.
The loan capital is being repaid in equal instalments starting on 31 July 2013 and on 31 July
each year thereafter.So I know how to calculate bank interest but I have to calculate how much of this loan is due within one year and if loan was taken on August 2012 but paid in 2013 July it means it was paying the previous year’s bill so when I assume how many years have been paid for I need to take it 4 or 5 years because when it will be paid on 31.07.17 it will be for the year of 2016.. so .. I am confused.
Thanks in advance.
You have not said what the company’s year end is!
Any repayment due within 12 months of the company’s year end is a current liability. All repayments due more than 12 months after the company’s year end are non-current liabilities.
It is the company’s year end that matters, and that does not have to be the same as the calendar year.
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