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If i have taken loan of â?¹ 10 lakh.. And the interest on this amount â?¹1 lakh is due since last 3 years.. Then what amount is considered as NPA? Is it 1 lakh only or the entire 11 lakh
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Best Answer
First ,if the one lakh is already recorded in p and l it has to be reversed ,after that we should not recognise interest any where untill it received Second, if the interest was not recorded anywhere then no entry required Third - the banks will prepare memrandum loan account ,here the interst will recorded for future purposes ,(like if the customer pay some money , then we may consider this memo ac for interest balance) Conclusion : ONLY 10 LAKHS WILL BE SHOWN AS NPA
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