Hi there - accounts question that has me stumped!
If I received a loan of 50k, repaid 5k and then the remainder was written-off by the lender a few years later, how do I show this in my accounts? Is there a transfer between the long=term liability account and income, or what?
The figures are representative - I'm not that lucky, lol
Thanks for any help, or pointers to where I can learn more
Gavin
No answer yet?
Depends on the original use of the loan. If it was used to acquire an asset, it might be most appropriate to adjust the cost of the asset. However if the asset has been depreciated, this may also involve adjusting depreciation expense and accumulated depreciation and it could get complicated.
Otherwise, recording it as income is probably most appropriate.
I recommend consulting your accountant. There may be tax implications!
account
With the exception of the recomendation to consult the accountant your post should be ignored.
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