What is interest payable on a balance sheet

What is Interest Payable? Interest Payable is a liability account, shown on a company's balance sheet, which represents the amount of interest expense that has accrued to date but has not been paid as of the date on the balance sheet. In short, it represents the amount of interest currently owed to lenders.

Where is interest payable on balance sheet?

Interest payable is a liability, and is usually found within the current liabilities section of the balance sheet. The associated interest expense that comprises interest payable is stated on the income statement for the amount applicable to the period whose results are being reported.

How do you calculate interest payable?

Divide your interest rate by the number of payments you'll make that year. If you have a 6 percent interest rate and you make monthly payments, you would divide 0.06 by 12 to get 0.005. Multiply that number by your remaining loan balance to find out how much you'll pay in interest that month.

Is interest payable is an expense?

Comparing Interest Expense and Interest Payable\n\n First, interest expense is an expense account, and so is stated on the income statement, while interest payable is a liability account, and so is stated on the balance sheet.