Goals, Business Plans & Entities

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Joe Kamenar
  • Bensalem, PA
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How is a Balloon Payment Accounted for in a Business Plan?

Joe Kamenar
  • Bensalem, PA
Posted Jan 24 2022, 11:08

Hi, if you are creating a business plan, and are looking for funding where you take a loan that has interest-only payments with a balloon payment a year or two down the road, how do you account for the balloon payment in your business plan? Is it considered an operating expense, a one-time expense or something else? I ask this because when the balloon gets paid, it will hit the business cash flow, so how is this amount accounted for?

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