Bank interest march deducted by bank in June

24 August 2020

Dear Sir please suggest for entry bank has debit Interest in June 2020 on account of March 2020 how to make the entry in books of account in March.

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prasad Nilugal ( GST Practitioner & Accounts ) (14167 Points)
Replied 24 August 2020

In the month of March 2020 on 31 st march You have pass following entry in the Books of accounts

1) Bank Interest A/c Dr

Outstanding bank Interest 19-20 A/c Cr

( being interest payable to bank Outstanding at the end of the year )

Note - show Outstanding bank interest 19-20 under liability side of Balance sheet

In the next year Out standing Bank 19-20 Interest A/c will be carried forward as oping balance

2) In the month June 2020 you pass the entry

Outstanding bank Interest 19-20 A/c Dr

To Bank A/c Cr

( being interest of 19-20 recovered in June 2020 by bank )

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