Posted On: 08/20/2013 1:28:15 PM
Post# of 45510
If you understand accounting which is not as logical as you would think this would make sense.
The interest expense is a combination of interest and debt accretion. The way this works is by combining the actual interest rate with the discount value on a conversion. As an example when we have a conversion fro our funding company we pay interest. They get shares at a discount. The discount is high/ It is 65%. So if we are paying off 35k They are actually getting 100k in stock. The 65k discount is added to the interest expense.
So no we did not borrow a million dollars. We have a current outstanding debt of 230k. I hope that helps you to understand this.
The interest expense is a combination of interest and debt accretion. The way this works is by combining the actual interest rate with the discount value on a conversion. As an example when we have a conversion fro our funding company we pay interest. They get shares at a discount. The discount is high/ It is 65%. So if we are paying off 35k They are actually getting 100k in stock. The 65k discount is added to the interest expense.
So no we did not borrow a million dollars. We have a current outstanding debt of 230k. I hope that helps you to understand this.
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