Is cash disbursement as loan to another company recorded as an expense on income statement?

by shane
(kissimmee, fl, USA)

Company A (a C-corp) loans money to LLC (no affiliation to Company A).

On Company A's income statement, is the disbursement records as an expense?

Later, as LLC begins payment to Company A, is the revenue from loan payments separated into principal and interest or is this irrelevant as all the income was derived from use of pre-tax dollars?

2nd portion: The note is a receivable (asset) on the balance sheet. Is it also recorded as equity to balance the sheet? Is there a specific title for the type of equity in such a case?


Hi Shane,

Is this a school accounting problem?

Because I don't solve homework problems.


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