This section is from the book "Elementary Banking", by John Franklin Ebersole. Also available from Amazon: Elementary Banking.
Charges to this account reflect the amount of credit given customers for interest on their deposits. Suppose that for the month ending June 30 interest on depositors' accounts amounted to $1,000. The general ledger entries covering this interest payment would be as follows:
Debit: Interest Paid on Deposits (23) | $1,000 | |
Credit: Due to Depositors (37)..... | $1,000 |
Of course, the amounts credited to the various depositors' accounts would be shown in detail in the depositors' ledger.
 
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