The amortised cost of a financial asset or financial liability is the amount
In view of the definition of the amortised cost, the following formula is used for its calculation:
The cumulative total amortisation TA(t_{n}) of payment date t_{n} is defined by

The following annuity loan is considered: Initially, there is also a charge of 5000 USD. Hence, the first cash flows for the deal are as follows: Applying the calculation method described, the calculation of the amortised cost of the deal starts as follows: 