Question

Write note Interest Suspense Account​

Answer 1

Answer:

Interest in suspense is a particular kind of asset that may appear on a company's -- or even an individual's – balance sheet. It often denotes that a company has money due as the result of a loan, but that its borrower has not paid on the loan per an agreement

Answer 2

Banks and other financial organisations utilise interest suspense accounts as a temporary holding and recording place for interest payments that are pending for various reasons. The account is set up to ensure that accurate accounting records are kept and that interest is paid or collected in the proper amount.

• When a bank or other financial institution is unable to determine the rightful owner of interest payments or if there are conflicts regarding interest computations, interest payments are kept in the Interest Suspense Account until the issue is resolved. The interest in suspense is reconciled at the conclusion of each accounting period and is frequently insignificant.
• Interest payments that are received or made after the end of the accounting period are also recorded in the Interest Suspense Account. The interest sum, for instance, is recorded in the Interest Suspense Account until the following accounting period if a borrower pays interest after the due date. The interest sum is recorded in the Interest Suspense Account until the next accounting period if a bank receives an interest payment after the due date.

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