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    jigna_jig's Avatar
    jigna_jig Posts: 1, Reputation: 1
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    #1

    Jun 5, 2009, 03:23 AM
    Journal entry for accrued interest on fixed deposits
    What would be the journal entry for accrued interest on bank fixed deposits?
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Jun 5, 2009, 07:00 AM

    Debit Interest Reveivable
    Credit Interest Revenue
    raulflocast's Avatar
    raulflocast Posts: 1, Reputation: 1
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    #3

    Dec 4, 2011, 08:32 PM
    Sample:
    I have an amount in terms deposit (principal), and I get interest on it, but I decide to roll over the interest.

    What I would do is to accrued the interest in an account call Prepayments (Liability account) and I credit an account of Income. This way I will show the interest accrued for the month, but not received yet (because we roll over it.)
    When I decide to actual receive the interest into my bank account I will need to debit my bank account (asset), offset my Prepayment Account (liability).
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #4

    Dec 5, 2011, 06:40 AM
    See my previous post to acrue interest.

    To record the insterest received your journal entry will be:
    Debit Cash for the amount of interest received
    Credit Interest Receivable (for acrued interest) or Interest Revenue (if interest was not acrued) for the amount of interest received.
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