Liabilities and equity

Loan amortisation schedule

Split each payment into interest and principal and see the current portion.

Amount borrowed

Annual interest rate

Term (years)

Payments

Rate per month: 7.2% ÷ 12 = 0.6% (60 basis points). Level payment of 2,387.48 a month for 60 months; the final payment is 2,387.73 to clear the rounding.

Schedule by year
Year	Opening	Payments	Interest	Principal	Closing
1	120,000.00	28,649.76	7,966.28	20,683.48	99,316.52
2	99,316.52	28,649.76	6,426.95	22,222.81	77,093.71
3	77,093.71	28,649.76	4,773.04	23,876.72	53,216.99
4	53,216.99	28,649.76	2,996.02	25,653.74	27,563.25
5	27,563.25	28,650.01	1,086.76	27,563.25	0.00
Total		143,249.05	23,249.05	120,000.00

At the end of year 1

Classification of the loan at the end of year 1
Current liabilityprincipal due in the next 12 months	22,222.81
Non-current liability	77,093.71
Loan balance	99,316.52

Only principal is split: interest for future periods isn't a liability yet. The split is a presentation matter — no journal entry is needed, though some charts move the current portion to a separate account.

Every payment (60)

Full payment schedule
Payment	Opening	Interest	Payment	Principal	Closing
1	120,000.00	720.00	2,387.48	1,667.48	118,332.52
2	118,332.52	710.00	2,387.48	1,677.48	116,655.04
3	116,655.04	699.93	2,387.48	1,687.55	114,967.49
4	114,967.49	689.80	2,387.48	1,697.68	113,269.81
5	113,269.81	679.62	2,387.48	1,707.86	111,561.95
6	111,561.95	669.37	2,387.48	1,718.11	109,843.84
7	109,843.84	659.06	2,387.48	1,728.42	108,115.42
8	108,115.42	648.69	2,387.48	1,738.79	106,376.63
9	106,376.63	638.26	2,387.48	1,749.22	104,627.41
10	104,627.41	627.76	2,387.48	1,759.72	102,867.69
11	102,867.69	617.21	2,387.48	1,770.27	101,097.42
12	101,097.42	606.58	2,387.48	1,780.90	99,316.52
13	99,316.52	595.90	2,387.48	1,791.58	97,524.94
14	97,524.94	585.15	2,387.48	1,802.33	95,722.61
15	95,722.61	574.34	2,387.48	1,813.14	93,909.47
16	93,909.47	563.46	2,387.48	1,824.02	92,085.45
17	92,085.45	552.51	2,387.48	1,834.97	90,250.48
18	90,250.48	541.50	2,387.48	1,845.98	88,404.50
19	88,404.50	530.43	2,387.48	1,857.05	86,547.45
20	86,547.45	519.28	2,387.48	1,868.20	84,679.25
21	84,679.25	508.08	2,387.48	1,879.40	82,799.85
22	82,799.85	496.80	2,387.48	1,890.68	80,909.17
23	80,909.17	485.46	2,387.48	1,902.02	79,007.15
24	79,007.15	474.04	2,387.48	1,913.44	77,093.71
25	77,093.71	462.56	2,387.48	1,924.92	75,168.79
26	75,168.79	451.01	2,387.48	1,936.47	73,232.32
27	73,232.32	439.39	2,387.48	1,948.09	71,284.23
28	71,284.23	427.71	2,387.48	1,959.77	69,324.46
29	69,324.46	415.95	2,387.48	1,971.53	67,352.93
30	67,352.93	404.12	2,387.48	1,983.36	65,369.57
31	65,369.57	392.22	2,387.48	1,995.26	63,374.31
32	63,374.31	380.25	2,387.48	2,007.23	61,367.08
33	61,367.08	368.20	2,387.48	2,019.28	59,347.80
34	59,347.80	356.09	2,387.48	2,031.39	57,316.41
35	57,316.41	343.90	2,387.48	2,043.58	55,272.83
36	55,272.83	331.64	2,387.48	2,055.84	53,216.99
37	53,216.99	319.30	2,387.48	2,068.18	51,148.81
38	51,148.81	306.89	2,387.48	2,080.59	49,068.22
39	49,068.22	294.41	2,387.48	2,093.07	46,975.15
40	46,975.15	281.85	2,387.48	2,105.63	44,869.52
41	44,869.52	269.22	2,387.48	2,118.26	42,751.26
42	42,751.26	256.51	2,387.48	2,130.97	40,620.29
43	40,620.29	243.72	2,387.48	2,143.76	38,476.53
44	38,476.53	230.86	2,387.48	2,156.62	36,319.91
45	36,319.91	217.92	2,387.48	2,169.56	34,150.35
46	34,150.35	204.90	2,387.48	2,182.58	31,967.77
47	31,967.77	191.81	2,387.48	2,195.67	29,772.10
48	29,772.10	178.63	2,387.48	2,208.85	27,563.25
49	27,563.25	165.38	2,387.48	2,222.10	25,341.15
50	25,341.15	152.05	2,387.48	2,235.43	23,105.72
51	23,105.72	138.63	2,387.48	2,248.85	20,856.87
52	20,856.87	125.14	2,387.48	2,262.34	18,594.53
53	18,594.53	111.57	2,387.48	2,275.91	16,318.62
54	16,318.62	97.91	2,387.48	2,289.57	14,029.05
55	14,029.05	84.17	2,387.48	2,303.31	11,725.74
56	11,725.74	70.35	2,387.48	2,317.13	9,408.61
57	9,408.61	56.45	2,387.48	2,331.03	7,077.58
58	7,077.58	42.47	2,387.48	2,345.01	4,732.57
59	4,732.57	28.40	2,387.48	2,359.08	2,373.49
60	2,373.49	14.24	2,387.73	2,373.49	0.00

Entries

Loan entries
Account	Debit	Credit
1000Cash at bank	120,000.00
2500Bank loan		120,000.00
Loan received
7000Interest expense	720.00
2500Bank loan	1,667.48
1000Cash at bank		2,387.48
First payment: interest 720.00 on the opening balance, the rest repays principal

In the statement of cash flows the loan received and principal repaid are financing flows; interest paid is operating or financing under IAS 7 as currently applied (a policy choice) — from 2027 the IFRS 18 amendments require financing for most non-financial companies — and operating under US GAAP.

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