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Every entity deposits its idle cash in its bank account. Depositing cash in the bank account will fetch interest to the entity and also ensure safety of the money. Cash deposit in the bank is one of the most recurring transactions in every entity’s day-to-day business activity. So, it is important tRead more
Every entity deposits its idle cash in its bank account. Depositing cash in the bank account will fetch interest to the entity and also ensure safety of the money. Cash deposit in the bank is one of the most recurring transactions in every entity’s day-to-day business activity. So, it is important to know the journal entry for the same.
Journal Entry for Cash Deposit in Bank
I will present the journal entry using both the golden rule and the modern rule of accounting.
1. According to the “Golden rules” of accounting
(Being cash deposited in the bank)
2. According to the “Modern rules” of accounting
(Being cash deposited in the bank)
Example
Sugar Ltd has idle cash 500,000. The finance manager deposited the idle amount in the company’s Bank of America A/c.
Journal entry in the books of Sugar Ltd will be as follows-
(Being Cash deposited in Bank of America A/c)
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