ASC 835-10

Overall

835 Interest

Download JSON Download Markdown21 paragraphs · 3 sectionsJump to summary

Source downloaded: 2026-09-10T01:48:52.102Z.Record version d11045a1d0c2. Effective date must be checked in the source.

In brief

IntroductoryRecognition Subsequent measurement Debt and equity Financial instruments

ASC 835-10 is the Overall subtopic of the Interest Topic; it does little more than map the Topic's structure and point readers elsewhere. It explains that Topic 835 addresses interest recognition in two instances — capitalization of interest costs incurred in connection with an investment in an asset (Subtopic 835-20) and imputation of interest where required (Subtopic 835-30) — and acknowledges that interest income/expense for specific transactions and instrument types is governed by other Topics.

Key points (7)

Topic 835 comprises three Subtopics: Overall (835-10), Capitalization of Interest (835-20), and Imputation of Interest (835-30) (835-10-05-1).
Topic 835 gives interest recognition guidance in only two instances — capitalization of interest costs in connection with an investment in an asset and situations requiring imputation of interest (835-10-05-2).
Interest income and expense for specific transactions and instrument types is addressed in other Topics, not in Topic 835 (835-10-05-3).
Loan origination fees and costs and commitment fees affect the yield of the related loan under Section 310-20-35, not Topic 835 (835-10-60-4).
Interest income on debt securities (320-10-35-4), structured notes (320-10-35-38), and dividend income on equity securities (321-10-35-6) are recognized under Topic 320/321 (835-10-60-5 through 60-6A).
Debt-specific interest guidance resides in Topic 470 — increasing-rate debt (470-10-35-1 through 35-2), conversion with forfeited accrued interest (470-20-35-11), modifications/exchanges (Section 470-50-40), and troubled debt restructurings (470-60-35-5 through 35-6).
Interest accrued on unrecognized tax benefits and on income tax underpayments follows 740-10-25-56 (835-10-60-14).

For students. Treat 835-10 as a signpost, not a rulebook: the substantive rules live in 835-20 (capitalization) and 835-30 (imputation). The common misunderstanding is assuming Topic 835 governs all interest recognition — in fact interest on loans, debt securities, restructured debt, and tax underpayments is governed by Topics 310, 320, 470, and 740.

interest income interest expense capitalization of interest imputation of interest effective yield scope and cross-references interest cost

Machine-generated study aid for ASC 835-10. Check the source paragraphs below.

835-10-00Status

Source downloaded: 2026-09-10T01:48:44.160Z.Record version 1c83bd5abe9a. Effective date must be checked in the source.

835-10-00-1

The following table identifies the changes made to this Subtopic.

Paragraph	Action	Accounting Standards Update	Date

835-10-05-3	Amended	Accounting Standards Update No. 2012-04	10/01/2012
835-10-60-2	Superseded	Accounting Standards Update No. 2016-13	06/16/2016
835-10-60-3	Superseded	Accounting Standards Update No. 2016-13	06/16/2016
835-10-60-5	Amended	Accounting Standards Update No. 2016-01	01/05/2016
835-10-60-6A	Added	Accounting Standards Update No. 2016-01	01/05/2016
835-10-60-7	Amended	Accounting Standards Update No. 2009-16	12/23/2009

835-10-05Overview and Background

Source downloaded: 2026-09-10T01:48:47.504Z.Record version f6ee856d2394. Effective date must be checked in the source.

835-10-05-1

The Interest Topic contains the following Subtopics:

a
Overall
b
Capitalization of Interest
c
Imputation of Interest.

835-10-05-2

This Topic provides guidance for interest income or expense recognition in two instances. Subtopic 835-20 provides guidance for capitalization of interest costs in connection with an investment in an asset. Subtopic 835-30 provides guidance for situations in which imputation of interest is required.

835-10-05-3

The recognition of interest income and interest expense for specific transactions and specific instrument types is also addressed in various other Topics.

835-10-60Relationships

Source downloaded: 2026-09-10T01:48:49.212Z.Record version f2644d145f85. Effective date must be checked in the source.

Presentation of Financial Statements

835-10-60-1

For guidance on the allocation of interest to discontinued operations, see paragraphs

205-20-45-6 through 45-8

Receivables

835-10-60-2

Paragraph superseded by Accounting Standards Update No. 2016-13.

835-10-60-3

Paragraph superseded by Accounting Standards Update No. 2016-13.

835-10-60-4

For guidance on the recognition of loan origination fees and costs and commitment fees and costs and the effect on the yield of the related loan, see Section 310-20-35.

Investments—Debt Securities

835-10-60-5

For guidance on recognition of interest income on investments in debt securities, see paragraph 320-10-35-4.

835-10-60-6

For guidance on recognition of interest income on structured notes, see paragraph 320-10-35-38.

Investments—Equity Securities

835-10-60-6A

For guidance on recognition of dividend income on investments in equity securities, see paragraph 321-10-35-6.

Investments—Other

835-10-60-7

For guidance on accounting for a transferor's interests in securitized transactions accounted for as sales (see Topic 860) and purchased beneficial interests, see Subtopic 325-40.

Other Assets and Deferred Costs

835-10-60-8

For guidance on the recognition of changes in the carrying amount of a deposit as interest income or interest expense when an insurance contract is accounted for as a deposit, see paragraph 340-30-45-2.

Debt

835-10-60-9

For guidance on the method of determining interest expense to be recognized for increasing-rate debt, see paragraphs

470-10-35-1 through 35-2

835-10-60-10

For guidance on whether interest should be accrued or imputed to the date of conversion of a debt instrument to an equity instrument where the terms provide that accrued but unpaid interest at the date of the conversion is forfeited by the debt holder, see paragraph 470-20-35-11.

835-10-60-11

For guidance on a debtor's accounting for a modification or exchange of debt instruments, see Section 470-50-40.

835-10-60-12

For guidance on the recognition of interest expense on a payable restructured in a troubled debt restructuring, see paragraphs

470-60-35-5 through 35-6

Distinguishing Liabilities from Equity

835-10-60-13

For guidance on the recognition of interest cost on forward contracts that require physical settlement by repurchase of a fixed number of the issuer's equity shares in exchange for cash, see paragraph 480-10-35-3.

Income Taxes

835-10-60-14

For recognition and measurement requirements for the accrual of interest on unrecognized tax benefits and for guidance on the recognition of interest expense when the tax law requires interest to be paid on an underpayment of income taxes, see paragraph 740-10-25-56.

Derivatives and Hedging

835-10-60-15

For guidance on the accounting for embedded features that alter net interest payments on an interest-bearing host contract, see paragraphs

815-15-25-26 through 25-27

Not-for-Profit Entities

835-10-60-16

For guidance on the presentation of accruals of the interest element related to unconditional promises to give by donees and by donors, see paragraph 958-310-45-2.