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in this video i want to talk about accounting for loan payments [Music] the most common type alone and the one were going to talk about is a higher purchase agreement where youre going to borrow money to purchase an asset that asset quite often will be a vehicle were going to look at an example an example im going to talk about is rugs by rosie rosie started her business and after a few months business was going well so she purchased a van she paid 10 000 pounds for that van now she might have paid for it in full but in this example were going to assume that she borrowed some money and were going to assume that she paid four thousand pounds of the van and she borrowed six thousand were going to look at our financial reports were going to look at the profit and loss account and were going to look at the balance sheet so first of all lets think about our balance sheet so shes purchased the van the van cost ten thousand pounds shes paid four thousand for it and shes borrowed
