Simple question: When is a long-term liability payment made, before profit and loss or after.

[dlrem49]

Was asked to do a profit and loss to divide up shares of profit, before note payment was made to a share holder. Then after a payment is made, how much should apply to the note, the interest, then the earnings on that particular division of the profits.

[TaxMonkey · Accepted solution]

A loan payment is made generally according to the loan agreement.  Between third parties usually monthly, but from a shareholder, often on demand or according to other terms.  The interest on a shareholder loan is a business expense and should be included on the P and L.