It refers to those income which we have earned but due date of receiving them has not yet arised


  • FD Made,not yet Matured
  • Loan given,interest not yet due


We book income on this as Accrued Income


Entry for Accrued Income

Asset Dr

            To Income


Accrued Income Dr

              To Income


Note:- Accrued Income is Current Asset


indirect exp.jpg




Pass Entry assuming Company follows annual closing

1.Loan given to Mr Darshan Rs 500000 @ 14% p.a.for 6 months on 1 March

   Pass Entry for

  • Loan  Given
  • Interest Accrued on Loan as on 31 March
  • Balance interest
  • Loan Repaid

Company follows annual closing

View Answer


2. FD Made of 500000 @ 8% for 1 month on 29 March

Pass Entries for

  • FD Made
  • Interest Accrued on FD as on 31 March
  • Balance Interest
  • FD Repaid
View Answer
  1. Accounts and Finance
  2. Step 3 Passing Book Closure Entries

About the Author

CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 10 years. He also provides Accounts Tax GST Training in Delhi and Pune.