56. Record On General Ledger

In a small bank, an account on the general ledger, called "certificates of deposit," will be found a sufficient record. This account is credited when certificates are issued and charged when they are paid. The account is kept, as shown in Figure 42 on page 90. When a certificate is paid, the debit is entered on the same line as the credit, regardless of the date of payment. The sum of the items on the credit side, having no corresponding debits, equals the certificates outstanding.

57. Separate Record

In a large bank a separate record is desirable, with only a controlling account on the general ledger* It is worth while to have a separate record for demand and time certificates* A good form is shown in Figure 43 on page 90. The Rand Company have a certificate of deposit register which has some good points. Figure 44 on page 92 shows a part of one of the pages of their book. The leaves are fastened in a special binder, down the middle of the sheet. When a certificate is issued the amount is entered in the amount column and in the certificate outstanding column. When the certificate is paid the date of payment is noted in the date paid column and two slits made with a pair of scissors, one above and one below the amount in the outstanding certificates column and the slip pulled out. The sum of the figures remaining in the last column should equal the Outstanding certificates. The chief objection to this record is that when a certificate remains unpaid for some time, the tabs fall off and of course trouble begins.

58. Credits For Accrued Interest

It is the custom in some banks to credit "accrued interest payable" to the certificates. This is objectionable, because the face of the certificate should represent the certificate of deposit account. If it is impossible or undesirable to remit the interest due to the depositor or to credit it to his check account, it should be set up in an accrued account for interest due on certificates of deposit and charged to this account when paid.

Paid

Certificates Of Deposit

Issued

Date 1909

Payee

No.

Amount

Date 1909

Order of

No.

Amount

July

16

Matthew Aaronson

1

1,500

July

6

Matthew Aaronson

1

1,500

7

Andrew Jackson

2

2 000

July

15

William Harrison

3

1,200

"

10

William Harrison

3

1,200

"

12

Daniel Boone

4

800

"

25

Henry Clay

5

1,000

.

Figure 42. Certificate Of Deposit Record.

Certificate Of Deposit Register

When Issued

Number

Order of

When Due

Amount

When Paid

Amount

Figure 43. Certificate Of Deposit Register.