Are loans consider assets or liabilities
Are loans consider assets or liabilities, Yes, Loans can be both assets and liability depending on the perspective of the entity or individual in question.
From the lender’s perspective, loans are assets as they represent the money that the lender has give out to the borrower.
The lender expects to receive interest income from the borrower over time, which increases the value of the loan asset.
From the borrower’s perspective, loans are liability as they represent the amount of money that the borrower owes to the lender.
The borrower has to repay the loan amount along with interest within a specify time period, which can create a financial burden on the borrower.
Loans can consider asset from the lender’s perspective and liability from the borrower’s perspective.
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