What does interest expense mean on the CPA exam?
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Interest expense. The cost of borrowing for the period, accrued as time passes rather than when the payment is made.
Defined against ASC 835-30.
Which CPA exam sections use interest expense?
Interest expense appears in the FAR section of the CPA exam.
Related terms
- accretion expense: The increase in an asset retirement obligation from the passage of time, measured by the interest method at the credit-adjusted risk-free rate in effect when the liability was first measured.
- functional expense: Expense classified by what it was FOR -- program, management and general, fundraising -- rather than by what it was.
- contract asset: The right to consideration for goods or services already transferred, where the right still depends on something other than the passage of time.
- interest income: What a lender earns for the use of its money over time, recognized as it is earned.