Module VI· Debt Schedule MechanicsIntermediate
Question
How do you aggregate total interest expense across all tranches?
Answer
Calculate interest for each tranche separately using the appropriate balance, rate, day-count / period convention, and cash versus PIK split. Sum cash interest, PIK interest, commitment fees, amortization of financing fees, and other debt costs as needed. Link total interest to the income statement and cash interest to the cash flow statement.