Write me the Journal Entries of these transactions :-
1) Interest Accrued and Due?
2) Interest Accrued but not Due?
Happy New Year To All Of You?
Deepak
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Replies (30)
Due means what? receivable or payable!
Due means what? receivable or payable!
If i will tell Meaning of Due then what u understood from question.
This is Question Of One of Interview in MNC. You are asked to reply it without counter question.
I suggest u to ask this question to that interviewer! He might be solve ur query. If u want to answer for ur query ,in this forum ,u must give clarification(whether its receivable or payable?
interest accrued and due means you must pay the interest to banker.
interest accurued and not due means you need not pay to banker.
interest accurued and due shows under the head current liabilities
interest accured but not due shows under the head lons, add a particular loan account
i wonder what people think about this stupid question. accounting entry will be same but treatment will be diferent in balance sheet......
1.if interest has accrued and due, then it is treated as revenue
2. if interest has accrued but not due it is treated as current asset or current liability depending upon whether the interest is receivable or payable
If it is from the view of the payer:
1.Entry for Interest Accrued and Due
Interest Accrued but not due Dr
To Cash/Party
2) Interest Accrued but not Due
Interest Accrued but not due A/c Dr.
To Interest
Entries for both the heads are same i.e.,
Debit Interest
Credit Accrued Interest.
However, disclosure as per Schedule VI is different.
1) Interest Accrued and Due?
ans:- intrest accured so you should pay it but its due so we have not paid it yet mean its our current liabilities.
effect: you shd add the new amount to old intrest and will be shown in b/s in left side.(current year)
2) Interest Accrued but not Due?
intrest has accured but has not due yet so no entry for it
treatment for preliminary expenses
both will be dibited to profit &loss account as an expenditure.
interest accrued and due will be shown under the head secured loans or unsecured loans as the case may be based upon type of loan.
interest accrued but not due will be shown under the head current liabilites
They Both are the same.
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