The proper treatment of loan origination fees is to
A)expense them in the year the loan is made
B)deduct them from the note proceeds
C)defer them and then recognize them as an increase to periodic interest revenue
D)add them to the discount and then amortize them over the life of the note

Question

Quizplus · Accepted Answer

Loan origination fees are deferred and then recognized as an increase to periodic interest revenue over the life of the loan, aligning the recognition of these fees with the period over which the loan generates interest income.

The Proper Treatment of Loan Origination Fees Is to