View Full Version : Journal entry for accrued interest on fixed deposits
jigna_jig
Jun 5, 2009, 03:23 AM
What would be the journal entry for accrued interest on bank fixed deposits?
pready
Jun 5, 2009, 07:00 AM
Debit Interest Reveivable
Credit Interest Revenue
raulflocast
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
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.