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| Interest Received Journal Entry |
When a business receives interest income, then it is necessary to record the transaction in its accounting records.
Journal Entry for Interest Received
Cash or Bank Account Debit
Interest Income Account Credit
- The "Cash" or "Bank Account" is debited because of an increase the Asset.
- The "Interest Income" account is credited because of recognizing the revenue from the interest received.
This journal entry represents the increase in the cash or bank balance due to the interest income and recognizes the revenue in the "Interest Income" account.
