15 March 2016
if i put a FD prin amt 5000 int.rate 9% p.a.maturity period 3 years. so how can i entered 1st year entry, 2nd year entry, and 3rd years entry
at present i practice Dr. FD , Cr. bank Dr. Accrued INT (Bal.Sheet) , Cr. Int. (p&l) (Which Reverse in Next Year) and when matured take actual int. received int. taken in P&L so we can track Prin.amt fd every time with pysically FDR.
15 March 2016
If FD booked Based on Number Every year you can credit interest (P& L) Debit Particular FD or as you have mentioned you can pass by Debiting Accrued Interest . If you debit Interest accrued directly to FD you will be knowing approximate value of FD . on Maturity adjust un adjusted interest to P& L account Credit FD if crediting interest to accrued interest than FD & Accrued Interest should be adjusted with balance interest on Maturity can be claimed in P& L A/c.
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