Whenever the bank mails a credit memo to the depositor indicating the amount of interest credited to the account,the transaction that would be entered in the accounting records of the depositor would include

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When a bank credits a depositor's account with interest, the depositor increases their cash balance (debit Cash) and recognizes the income received (credit Interest Earned). This reflects the increase in assets (cash) and the recognition of income (interest earned).

Whenever the Bank Mails a Credit Memo to the Depositor