In this lesson, explore the intricacies of notes payable with Nick Palazzolo, CPA, as he dives deeper into their characteristics and accounting treatments. Understand the difference between interest-bearing and noninterest-bearing notes, and how these form the basis of borrowings for a business. Nick breaks down the concept of present and face values, illuminating the issuance value for noninterest-bearing notes and their association with discounts and premiums. With a teaser about the upcoming in-depth bond section, he briefly explains why discounts may occur and how they are recognized as interest expense over the note's duration. This overview lays the groundwork for a thorough understanding of more complex debt instruments.
Lesson: Notes Payable
In this lesson, explore the intricacies of notes payable with Nick Palazzolo, CPA, as he dives deeper into their characteristics and accounting treatments. Understand the difference between interest-bearing and noninterest-bearing notes, and how these form the basis of borrowings for a business. Nick breaks down the concept of present and face values, illuminating the issuance value for noninterest-bearing notes and their association with discounts and premiums. With a teaser about the upcoming in-depth bond section, he briefly explains why discounts may occur and how they are recognized as interest expense over the note's duration. This overview lays the groundwork for a thorough understanding of more complex debt instruments.
Updated: Oct. 20, 2021 Create an account