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Hi Mr Moffat,
I was working a TB and came across Bank Interest on the CR side of the TrialBalance.
I thought that it was received (income) since it is on the CR side.
However when I had a look at the answer of this particular question, it was deducted – the book took it as an expense.
I was under the impression that an expense should be treated as DR in the TB.Kindly advise
You are correct in writing that interest income will be a credit balance and interest expense will be a debit balance.
Without seeing the whole question I cannot explain why this question showed differently.
Thank you for your reply.
On another note, could you kindly let me know the difference between a receivables ledger and a receivable ledger control account ?
Thanks and Regards
The receivables ledger is the book with individual accounts for each customer, and is not part of the double entry.
The receivables control account is the total receivables account in the nominal/general ledger, and is part of the double entry.I do suggest that you watch our free lectures on Books of Prime Entry. (Our free lectures are a complete course for Paper F3 and cover everything you need to be able to pass the exam well.)
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