Journal entries Updated November 2026

Bank reconciliation journal entries

Only book-side reconciling items need journal entries, because the ledger has not recorded them. Post Dr Bank Service Charges / Cr Cash for fees, Dr Cash / Cr Interest Income for interest, Dr Accounts Receivable / Cr Cash for NSF checks, Dr Cash / Cr Notes Receivable for collections, and a correction per book error.

Syntax

Fees: Dr Bank Charges / Cr Cash | Interest: Dr Cash / Cr Interest Income | NSF: Dr A/R / Cr Cash | Collection: Dr Cash / Cr Notes Receivable, Cr Interest Income

Part	What it is
`Service charge`	Dr Bank Service Charges, Cr Cash
`Interest earned`	Dr Cash, Cr Interest Income
`NSF check`	Dr Accounts Receivable, Cr Cash
`Note collected`	Dr Cash, Cr Notes Receivable and Cr Interest Income
`Automatic payment`	Dr Loan Payable or Expense, Cr Cash
`Book error`	Dr or Cr Cash for the difference, opposite entry to the original account

Examples

Book side: interest 15, service charge 30, NSF check 200, check #118 recorded 90 too low

Result: Dr Cash 15 / Cr Interest Income 15; Dr Bank Service Charges 30 / Cr Cash 30; Dr Accounts Receivable 200 / Cr Cash 200; Dr Accounts Payable 90 / Cr Cash 90. Net effect on Cash: -305.

Book balance before entries 6,305

Result: After posting: 6,305 + 15 - 30 - 200 - 90 = 6,000, which equals the adjusted balance.

One compound entry instead of four:
Dr Cash 15, Dr Bank Service Charges 30, Dr Accounts Receivable 200, Dr Accounts Payable 90 / Cr Interest Income 15, Cr Cash 320

Result: Debits 335 = credits 335; Cash nets to -305, same as the separate entries.

Common mistakes

Posting an entry for outstanding checks or deposits in transit: they are already in the books.
Crediting Cash for interest: interest increases cash, so Cash is debited.
Dating the entries in the next month: post them in the month being reconciled so the closing cash balance is right.

Practice Bank reconciliation journal entries

These drills check your answer on live data, free, no account needed.

Every entry in one monthClassify every line, enter both adjusted balances, then choose the journal entry the company must record for each item that affects its books.
Recording fees and interestClassify every line, enter both adjusted balances, then choose the journal entry the company must record for each item that affects its books.
Recording a collectionClassify every line, enter both adjusted balances, then choose the journal entry the company must record for each item that affects its books.

Questions

Do I post the entries before or after the reconciliation?

After you have identified the items and the adjusted balances agree, then post so the ledger equals the adjusted balance.

Can I combine all the entries into one?

Yes, a compound entry is fine as long as each account is shown separately and the debits equal the credits.

NSF check journal entryThe journal entry for an NSF (bounced) check: debit Accounts Receivable and credit Cash for the check amount, then record the fee as an expense or bill it.
Bank fee journal entryRecord bank fees from the statement with a debit to Bank Service Charges and a credit to Cash. Monthly fees, wire fees, NSF fees and merchant fees.
Interest income journal entryRecord bank interest with a debit to Cash and a credit to Interest Income when the statement shows it. Includes the accrual version for interest not yet paid.
Correcting entryA correcting entry fixes a mistake in a posted transaction: reverse the wrong part and record the right one, or post the net difference. Examples by error.