We have taken a business loan from bank of 15,00,000. Bank has deducted Insurance Premiun Rs. 10,000/-, Processing Fees Rs. 35,400/- and documentation charges Rs.3,000/-. The net amount disbursed is Rs.14,51,600/-. I have debited the Bank with Rs. 14,51,600/-, debited the expenses into one as Processing fees Rs. 48400/- and credited Loan account with Rs. 15,00,000/-.
Is the entry correct or will i have to bifurcate the expenses as Insurance premium, documentation charges and processing fees, as i have taken all the expenses into one that is processing fees.
CAclubindia
