Question

Accrued Revenue At 12/31/22, Earned $1,500 from a deposit at Capital One bank. The bank will remit the earnings to the company on 01/02/23. Required: Record the Accrual Entry for Interest Earned.

Answer 1

To record the accrual entry for interest earned, we need to recognize the revenue earned in the current accounting period, even if the cash has not been received. The journal entry would be Accrued Revenue (debit) - $1,500 and Interest Revenue (credit) - $1,500.

Step-by-step explanation:

To record the accrual entry for interest earned, we need to recognize the revenue earned in the current accounting period, even if the actual cash has not been received yet. In this case, the company earned $1,500 from a deposit at Capital One bank. Since the bank will remit the earnings on 01/02/23, we need to record this as accrued revenue on 12/31/22.

The journal entry to record this transaction would be:

Accrued Revenue (debit) - $1,500

Interest Revenue (credit) - $1,500