Fd in current account

A/c entries 3098 views 2 replies

radht

Self

70 Points Joined July 2013

A person is running a propritory bussiness and has made an FD from the current account .

FD IS made in the name of the business and not in the name of a person. FD is made for 2 years and 16 days since 2013 . FD was last renewed automatically for the same duration on 3/5/15 which will mature on 19/5/17. Pls note no interest amount/ Principal was credited to the current account as it was automatically renewed on 3/5/15.

MY querry is as under :

What entry should have been passed in April 2013 when the FD was booked and the amount was debited from current account . What entry shoulld have been passed on 31/3/14 and 31/3/15.

What entry should have been passed in the books of accounts on 3/5/15 to show the maturity and creation of new FD .

What entry should have been passed on 31/3/16 in the books of accounts for the interest received and TDS on the amount. Pls guide on urgent basis

Replies (2)

Bhavik Pankaj Mervana

49 Points Joined July 2016

when 1st Fd was created....
Fd ac dr....
To Current Ac (principal)
as on 31-3-14
ask ur bank to give interest certificate and then as per that interest show it as it has accrued
Fd ac dr....
To int on bank Fd
same case as on 31-3-15
ask abt int certificate and book the same entry.....
on 3-5-15
show the amt of diff of fd appearing in books and maturity amt as int in that year.......
and lastly during renewal ..
new fd dr......
To old Fd

Sayed Aziz Ahmed

Cost Accountant

36 Points Joined May 2013

I would prefer to check with Form 26AS to know wheather the bank has deducted tds on the accrued interest. In FY 2015-16 the entry should be passed on the basis of Interest accrued and TDS deducted as follows :

FD A/c Dr. Total interst - TDS
TDS Dr. TDS amount as per 26AS
Interst on FD Total Interest as shown in 26AS.