Hii
Just want to know, how to book interest income/accrued interest from interest certificate.
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Accrued Interest from Interest Certificate
Replies (5)
Quick Summary
1)when you receive interest pass entry .
Bank A/c Dr
To Interest Income A/c Cr
( Being interest income received )
2)Accured Interest Entry will be
Accured Interest A/c Dr
Interest Income A/c Cr
( Being interest accrued but not received) .
Bank A/c Dr
To Interest Income A/c Cr
( Being interest income received )
2)Accured Interest Entry will be
Accured Interest A/c Dr
Interest Income A/c Cr
( Being interest accrued but not received) .
Calculate the interest accrued by calculating the interest rate on principal amount.
TDS Receivable a/c dr
Interest receivable a/c dr
to Accrued Interest a/c
TDS Receivable a/c dr
Interest receivable a/c dr
to Accrued Interest a/c
In continuation to my above entries , When you received accrued interest in you account and TDS applicable then entry will be
Bank A./c Dr
TDS on interest A/c Dr
To Accrued Interest A/c Cr
( Being accrued Interest received after TDS deduction )
What does this mean? Do I have to declare the sum of interest received and the accrued interest when filing my tax teturns? My SBI interest certificate FY2021-22 shows separate columns for interest and accrued interest. Why do we need to consider accrued interest if it has not yet been credited to the account?
I found the reason for this consideration of accrued interest, is when we use the mercantile method of accounting.
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