Interest payable comes under current liabilities only which you deduct from current assets. Why will you deduct interest payable from current liabilities when interest payable is a part of current liabilities?
@@SabiAkther i already got the answer. I was of the assumption that that interest is not yet paid so it should go in current liabilities. But as per another tutor both assumptions are correct, you can either assume that interest has been paid from cash so it will reduce assets or its still payable so it will be part of liabilities.
It’s so helpful. I clearly understood this question. Thankyou so much
Why we do not deduct tax on return from investment?
Why do we not consider tax on profit on sale of non current. Why not 2000*0.8?
We do not include tax on profits , we only calculate tax to find the cash flow.
Why are we deducting interest payable from current assets instead of current liabilities?
Interest payable comes under current liabilities only which you deduct from current assets. Why will you deduct interest payable from current liabilities when interest payable is a part of current liabilities?
@@SabiAkther i already got the answer. I was of the assumption that that interest is not yet paid so it should go in current liabilities. But as per another tutor both assumptions are correct, you can either assume that interest has been paid from cash so it will reduce assets or its still payable so it will be part of liabilities.