341 - Capital Loans

Liabilities

Long Term Debt

Synopsis

Account 341

Debits

Credits

  1. Payments of the principal amount of loans recorded in this account.

  1. The principal amount of long-term capital loans from banks and finance companies.

 

Remarks:

The balance in this account represents amounts due to bank and finance companies on notes payable, either secured by collateral (other than vehicles) or unsecured, which are not due and payable until over one year from the original loan date.

Loans included in this account generally are directly related to the business (for example, initial capitalization, land, building, leaseholds, etc.).

A subsidiary record should be maintained indicating details of each loan.

Interest payable on capital loans should be recorded monthly and charged to Account 93 – Other Interest.

The portion of the notes which is due and payable within the succeeding twelve months from the balance sheet date should be included in Current Amount – LTD (Account 315). 

Note: