Interest expense is interest that is paid on debts, and interest expense is deducted from profits as expenses. Interest expense is either long-term or short-term interest.

For further reading on small business financials, check out The Key Elements of the Financial Plan, as well as How to Read Your Business’s Balance Sheet, What Is an Income Statement? and How to Forecast Cash Flow.

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Bplans GlossaryBplans Glossary

At Bplans, it's our goal to make it easy for you to start and run your business. Our glossary of common business terms will help you learn about key small business and entrepreneurship topics, to help you plan, fund, and grow your business.