Interest related topics
835-20: Capitalization of interest
For certain qualifying assets, interest costs are capitalized
–> and included in determining the acquisition cost of asset
–> and included in determining the acquisition cost of asset
835-30: Imputation of interest
For notes exchanged for cash or other assets
1. If face amount of the note > cash or fair value of the asset
–> the difference is discount
–> the difference is discount
2. If face amount of the note < cash or fair value of the asset
–> the difference is premium
–> the difference is premium
3. discount or premium is amortized using “interest method”
320-10-35: Interest income from investments
–> Interest income is recognized in earnings
–> Interest income is recognized in earnings
470-10-35: Interest cost of debt
–> Interest cost is recognized using interest method
–> Interest cost is recognized using interest method