What does interest expense mean on the CPA exam?
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 6 CPA exam sections: AUD, BAR, FAR, ISC, REG, TCP.
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.