Accrued interest on fdr accounting

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Ajit Y. Bhobe

Accounts Executive

26 Points Joined January 2012

Please any body help me in this

In current f.y. 2012-13 Interest received and credited to bank amounts to Rs. 13500 ( Where interest amounts to Rs. 15000 less 1500 tds)

Of this amount of Rs. 15000. interest accured is Rs. 10,000 less tds 1000 net 9000 ( Rs. 9000 interest is of previous year 2011-12

So entry in previous year where interest is added to FDR

FDR A/c Debit Rs. 9000

TDS on FDR Interest Debit. Rs. 1000

Interest on FDR Credit Rs. 10000

What will be the entry in current year

Should I have to credit the entire 13500 to interest Account

TDS on FDR interest Debit 500

Bank A/c 13,500

Interest on FDR ( 9000 Net interest of previous year +5000) credit Rs. 14000

Please advice if it is correct

Ajit Bhobe

Replies (6)

Ashish

Accounting

56 Points Joined April 2008

you should credit interest on FDR by Rs15000 (10000 + 5000)

Ashish

B.S.SRIMAL

Chartered Accountant

27 Points Joined December 2007

THE INTEREST SHALL BE CREDITED WITH Rs 15000/

BS.SRIMAL

Kishore Dichwalkar

PRACTICING CHARTERED ACCOUNTANT

45 Points Joined March 2009

Dear Ajit,

If i read your problem correctly, then you will have to credit interest on fdr account only by Rs.5000/- and debit TDS on Int on FDR by Rs.500/-.

I assume in all you have received interest on FDR Rs. 15,000/- for two years i.e. Rs. 10,000/- in the previous year and Rs. 5,000/- in the current year. TDS Rs. 1,000/- in previous year and Rs, 500/- in the Current Year.

Hope this explaination will solve your querry.

CA Jaspreet Singh Sidana

Chartered Accountant

45 Points Joined June 2010

Dear Ajit, accordin to me u shud pass the followin entry:

Bank a/c dr - 13500

TDS dr- 500

To Interest on fdr - 5000

To Interest accrued a/c- 9000.

Explainition: since you had passed an entry for accrued interest in the previous yr ..the same shall b reversed in the current year as the amount has been recieved.and balance Rs 5000 is of current yr and shall b credited to profit and loss account as current yr income.

regards,JASPREET