Slide17 - Accrual of Interest Interest is the “rent"...

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Unformatted text preview: Accrual of Interest - Interest is the “rent" paid for the use of money - Interest accumulates (accrues) as time passes, regardless of when a company actually pays cash for interest - Assume a company borrows $100,000 on December 31, 2005, and the terms of the loan require repayment of the loan amount of $100,000 plus interest on December 31, 2006 ...
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