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Type of Financial Transaction in which the Lender transfer a cash to the Borrower now in return for many smaller repayments of the Borrower to the Lender over time, usually on a fixed schedule.
The corresponding Cash proceeds are not tracked in P&L.
The total accruals of Share Capital proceeds in Cash value is recorded in Balance Sheet.
usual practise for a Lender to apply Interest charges above the Principle Sum.
The Interest can be Running Interest (if paid within the typical Accounting Period and It is recorded in Balance Sheet and not tracked in P&L) or Accrued Interest (and tracked in Balance Sheet).
See also
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Business / Business Administration / Financial Management / Financial Accounting
[ Balance Sheet ] [ P&L ]