Interest on loans is collected at various periods and under various arrangements in accordance with the agreement reached with the customer. Assume that a time loan for $5,000 at 6% is paid at maturity. The general ledger entries resulting are:

Nothing has been said up to the present concerning the accruing of interest on loans. That is dealt with in another chapter. The control of interest income varies so much in different banks that it would scarcely be possible to go into that here. Something will be said about it, however, later.