Ref Odomirok text pg 44
If net investment income is to be recorded on an accrual basis why don't we simply use the interest accrued (i.e. Earned) during the period instead of doing interest received + change in interest due and accrued?
Say we receive interest payment today for interest that was due in the prior year, isn't treating this as current year income incorrect? Moreover, if this interest was due and accrued in the prior year, aren't we double counting by considering the interest received as income in the current year and the change in interest due and accrued as income in the prior year?
If net investment income is to be recorded on an accrual basis why don't we simply use the interest accrued (i.e. Earned) during the period instead of doing interest received + change in interest due and accrued?
Say we receive interest payment today for interest that was due in the prior year, isn't treating this as current year income incorrect? Moreover, if this interest was due and accrued in the prior year, aren't we double counting by considering the interest received as income in the current year and the change in interest due and accrued as income in the prior year?
Interest Due and Accrued
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