#126Interest Expense Hardcoded Inside the Calculation Chain
three-statement.medTHREE-STATEMENT
1A1: Opening Debt Balance 4,500.0
2A2: Debt Drawdown 800.0
3A3: Debt Repayment -350.0
4A4: Closing Debt Balance =A1+A2+A3
5A5: Interest Rate 8.0%
6A6: Interest Expense 396.0
7A7: Net Income =EBIT-A6-Taxes
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#126PracticeMedium18 min · 120 XP
Interest Expense Hardcoded Inside the Calculation Chain
A model that behaved correctly at first now reports the same interest expense in every scenario, including one where the company repays all of its debt.
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