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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Questions on Journal entries
The company’s bank reconciliation at 30 June 2016 to the above nominal ledger balance, showed that bank interest paid for June 2016 of $400,000 had been taken from the company’s bank account but that the nominal ledger account did not yet reflect this payment.
The Journal Entry is it
Dr. Bank interest paid 400,000
Cr. Bank 400,000
Yes, or put another way:
Dr Expense Account 400,000
Cr Balance at Bank Account 400,000
or even:
Reduce Profits 400,000
Reduce Assets (or increase Liabilities if it’s an overdrawn balance at the bank) 400,000
OK?
