Journal Entry for Income

Journal Entry for Income

In this article, we would explain the journal entry for incomes.Income or increase in income is credited in the books accounts and other aspect is debited. Journal entry for income can be broadly classified into following types

Rule of Recording the Income

Increase in income is credit and decrease in income is debit.

1.   Cash Income Journal Entry:

Incomes are credited in the books of account and cash is debited for cash income . For example interest income received in cash amounting 60,000 shall be recorded as under

Date	Particulars	Dr.	Cr.
	Cash	$ 60,000
	Interest Income		$ 60,000

2.   Accrued Income Journal Entry:

Incomes earned, but still to be received shall be recorded as under. The income shall be credited and income receivable shall be debited.

Date	Particulars	Dr.	Cr.
	Interest Receivable	$ 60,000
	Income		$ 60,000

The above entries shows that there are two possible situation i.e. income is received immediately and income is to be received in future. in first scenario cash is debit ,while in second scenario receivable is created.