Capitalization of interest

Created by Erik Åkerlund, Modified on Mon, 20 Feb 2023 at 02:29 PM by Erik Åkerlund

Manual capitalization of interest rate

Enter the deal and create a capital increase of the same amount as the interest rate that day

The interest rate goes to maturity on payment date. The interest is then booked against cash and interest expense.  The capital increase will also be booked as cash and increase of the loan amount. So the accounting will be Cash +/-  0  interest expense and increase of loan.

Regarding accrued interest , since the capitalized interest will be “realised” on payment date the interest will not be accrued.

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