Capital Interest
Posted: 24 May 2007, 05:50
What nominal codes should I use for capital interest and loan interest on partnership accounts? Thanks for your help.
Not sure what you mean, what capital and what loan?
If the partnership has taken out a loan (eg from a bank or finance organisation) then interest would go in 790x
If the partnership has loaned money to another organisation then the interest will be in 4xxx
Of course, this could all be very different depending on what the loans are for and what the business does.
e.g. Interest repayments on a loan to buy a property might be handled as a cost of sale if you are a property developer. It could be treated and an overhead if you were a landlord, It could be a general interest charge if it was a bridging loan.