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Could you please explain the difference between interest expense and finance cost. Sometimes they both have different figures which gives impression that they both are not the same thing.
Is it true that interest expense refers to interest paid on borrowing loans whereas finance cost is a wide term which not only include interest on borrowing but also other charges resulting from the undertaking of that loan?
As far as Paper FA is concerned, they are the same thing. (Finance cost strictly includes not just interest but costs involved in borrowing the money such as fees, but this is not relevant for Paper FA).
If you have a Paper FA question which is confusing you on this, then type the question and I will explain 🙂
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