Question

journal entry of deposited cheque from savings account in firms account

Answer 1

The current transaction affects two accounts... savings Bank a/c (Payer).. because We are paying through Cheque. ,Bank a/c(current account; payee)... because We are depositing it in forms Current account..


The golden rules of accounting are...

Personal Account - Debit the receiver credit the giver

Nominal Account - Debit All expenses and losses, credit All incomes and gains

Real Account - Debit what comes in ,credit what goes out


Bank account is a Real account( Bank balance is an asset; all assets and Liabilities come under Real account)

in contention with the above rules....

Bank a/c (payee ; current account) should be debited..coz cash is comingin..

Bank a/c (Payer) should be credited..coz we are paying through Cheque,cash is going out


So the Journal Entry will be...

Bank a/c (current a/c) Dr xxxx

To Bank(savings) a/c xxxx

(being Cheque deposited into bank)