All Exams >
CA Foundation >
Accounting for CA Foundation >
All Questions
All questions of Unit 5: Cash Book for CA Foundation Exam
What will be journal entry when cash is withdrawn from bank for personal use ?- a)Drawings A/C debit, Bank A/C credit
- b)Cash A/C debit, Bank A/C credit
- c)Bank A/C debit. Drawings A/C credit
- d)Bank A/C debit, Capital A/C credit
Correct answer is option 'A'. Can you explain this answer?
What will be journal entry when cash is withdrawn from bank for personal use ?
a)
Drawings A/C debit, Bank A/C credit
b)
Cash A/C debit, Bank A/C credit
c)
Bank A/C debit. Drawings A/C credit
d)
Bank A/C debit, Capital A/C credit
|
Priya Patel answered |
Journal entry for cash withdrawn for personal use is
Drawings a/c dr
To Bank a/c
The above entire depends upon two principals of accounting i.e
Personal account:- Debit the receiver, credit the giver
Real account :- Debit what comes in, credit what goes out.
Contra entries are passed only when- a)Three-column cash book is prepared
- b)Double-column cash book is prepared
- c)Simple cash book is prepared
- d)None of the above
Correct answer is option 'B'. Can you explain this answer?
Contra entries are passed only when
a)
Three-column cash book is prepared
b)
Double-column cash book is prepared
c)
Simple cash book is prepared
d)
None of the above
|
Lekshmi Mehta answered |
Contra-entries are passed only when Double column cash book is prepared. The reason for making two entries is to comply with the principle of double entry.
Imprest amount – Rs. 500. What will be the amount of re-imbursement if following expenses were incurred by the petty cashier during the month-Telephone =Rs. 150, Tiffin = Rs. 50, small Repairs = Rs. 30 general expenses = Rs. 100.- a)300
- b)170
- c)330
- d)270
Correct answer is option 'C'. Can you explain this answer?
Imprest amount – Rs. 500. What will be the amount of re-imbursement if following expenses were incurred by the petty cashier during the month-Telephone =Rs. 150, Tiffin = Rs. 50, small Repairs = Rs. 30 general expenses = Rs. 100.
a)
300
b)
170
c)
330
d)
270
|
Srsps answered |
The correct option is C.
Imprest amount=500
Expenses=Telephone expenses+tiffin+small repairs +general expenses=150+50+30+100=330
Amount of reimbursement=Amount to be paid=₹300
The total of discounts column on the debit side of the cash book, recording cash discount deducted by customers when paying their accounts, is posted to the - a)Credit of the discount allowed account.
- b)Debit of the discount received account.
- c)Credit of the discount received account
- d)Debit of the discount allowed account.
Correct answer is option 'D'. Can you explain this answer?
The total of discounts column on the debit side of the cash book, recording cash discount deducted by customers when paying their accounts, is posted to the
a)
Credit of the discount allowed account.
b)
Debit of the discount received account.
c)
Credit of the discount received account
d)
Debit of the discount allowed account.
|
Shivam Chawla answered |
Explanation:
The cash book is a book of original entry in which all transactions relating to cash receipts and payments are recorded. The discounts column in the cash book is used to record the cash discounts allowed to customers for early payment of their accounts.
When a customer pays their account early and takes advantage of the cash discount offered, the amount of the discount is deducted from the amount owed by the customer and recorded in the discounts column of the cash book.
At the end of the accounting period, the total of the discounts column on the debit side of the cash book is posted to the discount allowed account in the general ledger. This is because the cash discounts allowed represent a reduction in the revenue earned by the business.
Therefore, the correct answer is option 'D', i.e., the total of discounts column on the debit side of the cash book is posted to the debit side of the discount allowed account in the general ledger.
In summary, the discounts column in the cash book is used to record cash discounts allowed to customers for early payment, and the total of the discounts column on the debit side is posted to the discount allowed account in the general ledger.
The cash book is a book of original entry in which all transactions relating to cash receipts and payments are recorded. The discounts column in the cash book is used to record the cash discounts allowed to customers for early payment of their accounts.
When a customer pays their account early and takes advantage of the cash discount offered, the amount of the discount is deducted from the amount owed by the customer and recorded in the discounts column of the cash book.
At the end of the accounting period, the total of the discounts column on the debit side of the cash book is posted to the discount allowed account in the general ledger. This is because the cash discounts allowed represent a reduction in the revenue earned by the business.
Therefore, the correct answer is option 'D', i.e., the total of discounts column on the debit side of the cash book is posted to the debit side of the discount allowed account in the general ledger.
In summary, the discounts column in the cash book is used to record cash discounts allowed to customers for early payment, and the total of the discounts column on the debit side is posted to the discount allowed account in the general ledger.
Salaries due for the month of March will appear- a)on the receipt side of the cash book
- b)on the payment side of the cash-book
- c)as a contra entry
- d)nowhere in the cash book
Correct answer is option 'D'. Can you explain this answer?
Salaries due for the month of March will appear
a)
on the receipt side of the cash book
b)
on the payment side of the cash-book
c)
as a contra entry
d)
nowhere in the cash book
|
Nature Lover answered |
It in an outstanding expense hence liability of the firm,it will appear on liabilities side of balance sheet,and debit side on p&l account,but nowhere in cash book,as it is not a cash transaction
Salaries due for the month of March will appear - a)On the receipt side of the cash book
- b)On the payment side of the cash book
- c)As a contra entry
- d)Nowhere in the cash book
Correct answer is option 'D'. Can you explain this answer?
Salaries due for the month of March will appear
a)
On the receipt side of the cash book
b)
On the payment side of the cash book
c)
As a contra entry
d)
Nowhere in the cash book
|
|
Aarya Sharma answered |
Explanation:
Salaries due for the month of March are not recorded in the cash book because they are not paid yet. Salaries are considered as an expense for the business, which is recorded in the income statement or profit and loss account. The cash book records all cash and bank transactions of a business, which includes cash receipts and cash payments.
The following points explain why salaries due for the month of March will not appear in the cash book:
1. Definition of Cash Book: The cash book is a book of original entry that records all cash and bank transactions of a business. Salaries due for the month of March are not cash transactions, as they are not paid yet.
2. Timing of Salaries: Salaries are usually paid at the end of the month or after the end of the month. As such, the salaries due for the month of March will not be paid until the end of March or the beginning of April. Therefore, they will not appear in the cash book for the month of March.
3. Accrual Accounting: Accrual accounting is a method of accounting where revenues and expenses are recognized when they are earned or incurred, regardless of when cash is received or paid. Salaries due for the month of March are considered as an expense for the business, which is recorded in the income statement or profit and loss account, not in the cash book.
In conclusion, salaries due for the month of March will not appear in the cash book because they are not cash transactions and are not paid yet. They are recorded as an expense in the income statement or profit and loss account.
Salaries due for the month of March are not recorded in the cash book because they are not paid yet. Salaries are considered as an expense for the business, which is recorded in the income statement or profit and loss account. The cash book records all cash and bank transactions of a business, which includes cash receipts and cash payments.
The following points explain why salaries due for the month of March will not appear in the cash book:
1. Definition of Cash Book: The cash book is a book of original entry that records all cash and bank transactions of a business. Salaries due for the month of March are not cash transactions, as they are not paid yet.
2. Timing of Salaries: Salaries are usually paid at the end of the month or after the end of the month. As such, the salaries due for the month of March will not be paid until the end of March or the beginning of April. Therefore, they will not appear in the cash book for the month of March.
3. Accrual Accounting: Accrual accounting is a method of accounting where revenues and expenses are recognized when they are earned or incurred, regardless of when cash is received or paid. Salaries due for the month of March are considered as an expense for the business, which is recorded in the income statement or profit and loss account, not in the cash book.
In conclusion, salaries due for the month of March will not appear in the cash book because they are not cash transactions and are not paid yet. They are recorded as an expense in the income statement or profit and loss account.
Which of the following is the kind of a cash-book ?- a)Simple column cash-book
- b)Double column cash-book
- c)Three column cash-book
- d)All of the above
Correct answer is option 'D'. Can you explain this answer?
Which of the following is the kind of a cash-book ?
a)
Simple column cash-book
b)
Double column cash-book
c)
Three column cash-book
d)
All of the above
|
|
Akshay Das answered |
Types of Cash-book
There are different types of cash-books that are used to record the cash transactions of a business. The different types are:
1. Simple column cash-book
2. Double column cash-book
3. Three column cash-book
Explanation:
- Simple column cash-book: This is the most basic type of cash-book. It has only one column to record cash receipts and payments. It is suitable for small businesses with minimal cash transactions.
- Double column cash-book: This type of cash-book has two columns - one for cash receipts and the other for cash payments. It is suitable for businesses with a moderate amount of cash transactions.
- Three column cash-book: This type of cash-book has three columns - one for cash receipts, one for cash payments, and one for discount allowed and received. It is suitable for businesses that give and receive discounts on cash transactions.
Therefore, the correct answer is option 'D' - All of the above as all three types of cash-books are kinds of cash-books.
There are different types of cash-books that are used to record the cash transactions of a business. The different types are:
1. Simple column cash-book
2. Double column cash-book
3. Three column cash-book
Explanation:
- Simple column cash-book: This is the most basic type of cash-book. It has only one column to record cash receipts and payments. It is suitable for small businesses with minimal cash transactions.
- Double column cash-book: This type of cash-book has two columns - one for cash receipts and the other for cash payments. It is suitable for businesses with a moderate amount of cash transactions.
- Three column cash-book: This type of cash-book has three columns - one for cash receipts, one for cash payments, and one for discount allowed and received. It is suitable for businesses that give and receive discounts on cash transactions.
Therefore, the correct answer is option 'D' - All of the above as all three types of cash-books are kinds of cash-books.
Rent due for the month of March will appear _________of the cash book. - a)On the receipt side
- b)On the payment side
- c)As a Contra Entry
- d)Nowhere
Correct answer is option 'D'. Can you explain this answer?
Rent due for the month of March will appear _________of the cash book.
a)
On the receipt side
b)
On the payment side
c)
As a Contra Entry
d)
Nowhere
|
|
Arka Tiwari answered |
Explanation:
Rent due for the month of March is an expense for the business. In the cash book, all transactions related to cash and bank are recorded.
- Receipt side: Transactions related to cash received are recorded on the receipt side of the cash book.
- Payment side: Transactions related to cash paid are recorded on the payment side of the cash book.
- Contra Entry: A contra entry is a transaction that involves both cash and bank accounts. For example, when cash is withdrawn from the bank, it is recorded as a debit in the cash book and a credit in the bank account. Similarly, when cash is deposited into the bank, it is recorded as a credit in the cash book and a debit in the bank account.
- Nowhere: Rent due for the month of March does not involve any cash or bank account. It is simply an expense that needs to be paid by the business. Therefore, it will not appear in the cash book.
Conclusion:
In conclusion, rent due for the month of March will not appear in the cash book as it does not involve any cash or bank account. It is simply an expense that needs to be paid by the business.
Rent due for the month of March is an expense for the business. In the cash book, all transactions related to cash and bank are recorded.
- Receipt side: Transactions related to cash received are recorded on the receipt side of the cash book.
- Payment side: Transactions related to cash paid are recorded on the payment side of the cash book.
- Contra Entry: A contra entry is a transaction that involves both cash and bank accounts. For example, when cash is withdrawn from the bank, it is recorded as a debit in the cash book and a credit in the bank account. Similarly, when cash is deposited into the bank, it is recorded as a credit in the cash book and a debit in the bank account.
- Nowhere: Rent due for the month of March does not involve any cash or bank account. It is simply an expense that needs to be paid by the business. Therefore, it will not appear in the cash book.
Conclusion:
In conclusion, rent due for the month of March will not appear in the cash book as it does not involve any cash or bank account. It is simply an expense that needs to be paid by the business.
Postage stamps purchased for Rs. 30 by business. This transaction will be recorded in:- a)Purchase book
- b)Cash Book
- c)Petty Cash Book
- d)Journal
Correct answer is option 'C'. Can you explain this answer?
Postage stamps purchased for Rs. 30 by business. This transaction will be recorded in:
a)
Purchase book
b)
Cash Book
c)
Petty Cash Book
d)
Journal
|
|
Anu Sen answered |
Transaction recorded in Petty Cash Book
Petty Cash Book is used to record small cash transactions of a business. In this case, the purchase of postage stamps for Rs. 30 is a small cash transaction that can be easily recorded in the Petty Cash Book.
Explanation:
- Petty Cash Book: As mentioned earlier, Petty Cash Book is used to record small cash transactions. It is maintained by the person responsible for handling petty cash in the business. It contains columns for date, particulars, voucher number, amount, and balance.
- Purchase Book: Purchase Book is used to record credit purchases of goods. Since the transaction in question involves cash purchase of postage stamps, it cannot be recorded in the Purchase Book.
- Cash Book: Cash Book is used to record all cash transactions of a business. However, Petty Cash transactions are not recorded in the Cash Book as they are recorded separately in the Petty Cash Book.
- Journal: Journal is used to record all non-cash transactions of a business. Since the transaction in question involves cash purchase, it cannot be recorded in the Journal.
Conclusion:
Since the transaction involves a small cash purchase, it can be easily recorded in the Petty Cash Book. Petty Cash Book is a subsidiary book of accounts that helps in maintaining proper records of small cash transactions.
Petty Cash Book is used to record small cash transactions of a business. In this case, the purchase of postage stamps for Rs. 30 is a small cash transaction that can be easily recorded in the Petty Cash Book.
Explanation:
- Petty Cash Book: As mentioned earlier, Petty Cash Book is used to record small cash transactions. It is maintained by the person responsible for handling petty cash in the business. It contains columns for date, particulars, voucher number, amount, and balance.
- Purchase Book: Purchase Book is used to record credit purchases of goods. Since the transaction in question involves cash purchase of postage stamps, it cannot be recorded in the Purchase Book.
- Cash Book: Cash Book is used to record all cash transactions of a business. However, Petty Cash transactions are not recorded in the Cash Book as they are recorded separately in the Petty Cash Book.
- Journal: Journal is used to record all non-cash transactions of a business. Since the transaction in question involves cash purchase, it cannot be recorded in the Journal.
Conclusion:
Since the transaction involves a small cash purchase, it can be easily recorded in the Petty Cash Book. Petty Cash Book is a subsidiary book of accounts that helps in maintaining proper records of small cash transactions.
In three column Cash Book, when does contra entry occurs?- a)Withdrawal of cash from bank
- b)Payment to creditors
- c)Withdrawal of cash from bank for personal use
- d)All of the above
Correct answer is option 'A'. Can you explain this answer?
In three column Cash Book, when does contra entry occurs?
a)
Withdrawal of cash from bank
b)
Payment to creditors
c)
Withdrawal of cash from bank for personal use
d)
All of the above
|
Jayant Mishra answered |
In case of three column cash book, when cash is withdrawn from bank for use in the office the amount is entered in the bank column in the payment side and also in the cash column on the receipt side. Such entries are called contra entries and a letter "C" should be written in front of such entries in the L.F. column.
Where two aspects of a transaction are posted in the Cash Book, such an entry is called - a)Double entry
- b)Debit Entry
- c)Credit Entry
- d)Contra Entry
Correct answer is option 'D'. Can you explain this answer?
Where two aspects of a transaction are posted in the Cash Book, such an entry is called
a)
Double entry
b)
Debit Entry
c)
Credit Entry
d)
Contra Entry
|
|
Lakshmi Kaur answered |
Contra Entry in Cash Book
In accounting, a Cash Book is a book in which all cash transactions are recorded. The Cash Book has two sides, namely, Debit and Credit. When two aspects of a transaction are posted on both sides of the Cash Book, such an entry is called a Contra Entry. Let's understand the Contra Entry in Cash Book in detail:
Meaning of Contra Entry
A Contra Entry is a transaction that involves both Cash and Bank accounts. In other words, it is a transaction that takes place between the Cash account and Bank account of the same entity. Since both accounts are maintained in the Cash Book, a Contra Entry is recorded on both sides of the Cash Book.
For example, if an entity withdraws money from the Bank and deposits it into the Cash account, it is a Contra Entry. Similarly, if an entity deposits money into the Bank from the Cash account, it is also a Contra Entry.
Recording Contra Entry in Cash Book
When a Contra Entry is recorded in the Cash Book, it is recorded on both the Debit and Credit sides of the Cash Book. The following steps are taken to record a Contra Entry in the Cash Book:
Step 1: Identify the transaction that involves both Cash and Bank accounts.
Step 2: Record the transaction on the Debit side of the Cash Book under the Bank column.
Step 3: Record the same transaction on the Credit side of the Cash Book under the Cash column.
Step 4: Write "By Bank" in the L.F. column on the Debit side of the Cash Book and "To Cash" in the L.F. column on the Credit side of the Cash Book.
Step 5: Calculate the total of both the Debit and Credit columns and ensure that they balance.
Conclusion
Thus, a Contra Entry is a transaction that involves both Cash and Bank accounts of the same entity. When such a transaction is recorded in the Cash Book, it is recorded on both the Debit and Credit sides of the Cash Book. Contra Entry is an important concept in accounting and is often tested in exams like CA Foundation.
In accounting, a Cash Book is a book in which all cash transactions are recorded. The Cash Book has two sides, namely, Debit and Credit. When two aspects of a transaction are posted on both sides of the Cash Book, such an entry is called a Contra Entry. Let's understand the Contra Entry in Cash Book in detail:
Meaning of Contra Entry
A Contra Entry is a transaction that involves both Cash and Bank accounts. In other words, it is a transaction that takes place between the Cash account and Bank account of the same entity. Since both accounts are maintained in the Cash Book, a Contra Entry is recorded on both sides of the Cash Book.
For example, if an entity withdraws money from the Bank and deposits it into the Cash account, it is a Contra Entry. Similarly, if an entity deposits money into the Bank from the Cash account, it is also a Contra Entry.
Recording Contra Entry in Cash Book
When a Contra Entry is recorded in the Cash Book, it is recorded on both the Debit and Credit sides of the Cash Book. The following steps are taken to record a Contra Entry in the Cash Book:
Step 1: Identify the transaction that involves both Cash and Bank accounts.
Step 2: Record the transaction on the Debit side of the Cash Book under the Bank column.
Step 3: Record the same transaction on the Credit side of the Cash Book under the Cash column.
Step 4: Write "By Bank" in the L.F. column on the Debit side of the Cash Book and "To Cash" in the L.F. column on the Credit side of the Cash Book.
Step 5: Calculate the total of both the Debit and Credit columns and ensure that they balance.
Conclusion
Thus, a Contra Entry is a transaction that involves both Cash and Bank accounts of the same entity. When such a transaction is recorded in the Cash Book, it is recorded on both the Debit and Credit sides of the Cash Book. Contra Entry is an important concept in accounting and is often tested in exams like CA Foundation.
Which of the following is not a column of a three-column cash book?- a)Cash column
- b)Bank column
- c)Petty cash column
- d)Discount column
Correct answer is option 'C'. Can you explain this answer?
Which of the following is not a column of a three-column cash book?
a)
Cash column
b)
Bank column
c)
Petty cash column
d)
Discount column
|
Lakshya Raj answered |
Petty cash book is the correct because the petty cash book balance is an asset and all the mini expenses recorded in petty cash book
In petty cash Book, the system followed :- a)Accrual System
- b)Imprest System
- c)Cash system
- d)None of these
Correct answer is option 'B'. Can you explain this answer?
In petty cash Book, the system followed :
a)
Accrual System
b)
Imprest System
c)
Cash system
d)
None of these
|
Deepak Hegde answered |
In the beginning of every month or period main cashier gives some amount to the petty cashier.this system is called as Imprest system
Cash book is a type of __________ but treated as a ____________ of accounts.- a)Subsidiary book, principal book
- b)Principal book, subsidiary book
- c)Subsidiary book, Subsidiary book
- d)Principal book, Principal book
Correct answer is option 'A'. Can you explain this answer?
Cash book is a type of __________ but treated as a ____________ of accounts.
a)
Subsidiary book, principal book
b)
Principal book, subsidiary book
c)
Subsidiary book, Subsidiary book
d)
Principal book, Principal book
|
|
Meera Basak answered |
Cash Book as a Subsidiary Book and Principal Book
Cash book is a record of all cash transactions of a business. It is used to record receipts and payments of cash, bank and discount. It is a type of subsidiary book but treated as a principal book of accounts. Let's understand why.
Subsidiary Book
Subsidiary books are the books of original entry where the transactions are first recorded. These are also known as subsidiary ledger. The purpose of subsidiary books is to record specific types of transactions in a systematic way. Some examples of subsidiary books are purchases book, sales book, journal proper, etc.
Cash Book as a Subsidiary Book
Cash book is also a subsidiary book as it records cash and cash equivalent transactions. It is used to record all cash receipts and payments of a business. Cash book is divided into two parts - cash column and bank column. The cash column is used to record all cash transactions, while the bank column is used to record all bank transactions. Cash book is a book of original entry as it records transactions as they occur.
Principal Book
Principal books are the books of accounts where the transactions are finally recorded. These are also known as principal ledger. The purpose of principal books is to summarize the transactions recorded in subsidiary books and present the financial position of the business. Some examples of principal books are ledger accounts, trial balance, financial statements, etc.
Cash Book as a Principal Book
Cash book is also a principal book as it summarizes all cash and cash equivalent transactions of a business. It is used to prepare the cash account of a business, which is a part of the final accounts. Cash book is used to record all cash receipts and payments, which are then summarized in the cash account. Cash account is a part of the ledger accounts, which is a principal book.
Conclusion
In conclusion, cash book is a type of subsidiary book as it records cash and cash equivalent transactions. It is also a principal book as it summarizes all cash transactions and presents the financial position of a business. Therefore, the correct answer is option 'A'.
Cash book is a record of all cash transactions of a business. It is used to record receipts and payments of cash, bank and discount. It is a type of subsidiary book but treated as a principal book of accounts. Let's understand why.
Subsidiary Book
Subsidiary books are the books of original entry where the transactions are first recorded. These are also known as subsidiary ledger. The purpose of subsidiary books is to record specific types of transactions in a systematic way. Some examples of subsidiary books are purchases book, sales book, journal proper, etc.
Cash Book as a Subsidiary Book
Cash book is also a subsidiary book as it records cash and cash equivalent transactions. It is used to record all cash receipts and payments of a business. Cash book is divided into two parts - cash column and bank column. The cash column is used to record all cash transactions, while the bank column is used to record all bank transactions. Cash book is a book of original entry as it records transactions as they occur.
Principal Book
Principal books are the books of accounts where the transactions are finally recorded. These are also known as principal ledger. The purpose of principal books is to summarize the transactions recorded in subsidiary books and present the financial position of the business. Some examples of principal books are ledger accounts, trial balance, financial statements, etc.
Cash Book as a Principal Book
Cash book is also a principal book as it summarizes all cash and cash equivalent transactions of a business. It is used to prepare the cash account of a business, which is a part of the final accounts. Cash book is used to record all cash receipts and payments, which are then summarized in the cash account. Cash account is a part of the ledger accounts, which is a principal book.
Conclusion
In conclusion, cash book is a type of subsidiary book as it records cash and cash equivalent transactions. It is also a principal book as it summarizes all cash transactions and presents the financial position of a business. Therefore, the correct answer is option 'A'.
If the debit and credit aspects of a transaction are recorded in the cash Book it is a : - a)Contra entry
- b)Simple entry
- c)Double entry
- d)Single entry
Correct answer is option 'A'. Can you explain this answer?
If the debit and credit aspects of a transaction are recorded in the cash Book it is a :
a)
Contra entry
b)
Simple entry
c)
Double entry
d)
Single entry
|
|
Subhankar Sen answered |
Contra Entry in Cash Book:
A contra entry is a type of entry that records both debit and credit aspects of a transaction in the cash book. It is called a contra entry because it cancels or offsets each other. This type of entry is also known as a cash transaction.
Explanation:
When a cash transaction occurs, the cash book records both debit and credit aspects of the transaction. For example, when cash is withdrawn from the bank, the cash book records the following entries:
Debit aspect: Cash Account - To record the withdrawal of cash.
Credit aspect: Bank Account - To record the reduction in the bank balance.
This entry is called a contra entry because it cancels each other. Here, the cash account is debited, and the bank account is credited.
Conclusion:
The correct option for the given question is option 'A,' Contra entry, because it records both debit and credit aspects of a transaction in the cash book.
A contra entry is a type of entry that records both debit and credit aspects of a transaction in the cash book. It is called a contra entry because it cancels or offsets each other. This type of entry is also known as a cash transaction.
Explanation:
When a cash transaction occurs, the cash book records both debit and credit aspects of the transaction. For example, when cash is withdrawn from the bank, the cash book records the following entries:
Debit aspect: Cash Account - To record the withdrawal of cash.
Credit aspect: Bank Account - To record the reduction in the bank balance.
This entry is called a contra entry because it cancels each other. Here, the cash account is debited, and the bank account is credited.
Conclusion:
The correct option for the given question is option 'A,' Contra entry, because it records both debit and credit aspects of a transaction in the cash book.
Imprest received of Rs. 100 was recorded as interest paid. What will be the effect on cash balance?- a)Cash will reduce by 100.
- b)Cash will increase by 200
- c)Cash will reduce by 200.
- d)No effect on cash balance.
Correct answer is option 'C'. Can you explain this answer?
Imprest received of Rs. 100 was recorded as interest paid. What will be the effect on cash balance?
a)
Cash will reduce by 100.
b)
Cash will increase by 200
c)
Cash will reduce by 200.
d)
No effect on cash balance.
|
|
Priya Patel answered |
Description: Correct Entry:
Cash A/c Dr. 100
To Interest A/c 100
( Being interest received)
Wrong Entry:
Interest A/c Dr. 100
To Cash A/c 100
( Being interest paid)
The effect of the above wrong entry will be that cash balance will be reduced by Rs. 200.
Rent due for the month of March will appear __________ in the Cash book. - a)On the receipt side
- b)On the payment side
- c)As a contra entry
- d)No where
Correct answer is option 'D'. Can you explain this answer?
Rent due for the month of March will appear __________ in the Cash book.
a)
On the receipt side
b)
On the payment side
c)
As a contra entry
d)
No where
|
|
Geetika Basak answered |
Explanation:
Rent is an expense and according to the rules of accounting, expenses are recorded on the payment side of the Cash book. However, as the question mentions that the rent is due for the month of March, it means that it has not been paid yet. Hence, it will not appear anywhere in the Cash book for the month of March.
Since the rent is due and has not been paid, it cannot be recorded on the receipt side of the Cash book. Also, it cannot be recorded as a contra entry because a contra entry is a transaction that involves both cash and bank accounts, and in this case, only the rent account is involved.
Therefore, the correct answer is option 'D' which states that the rent due for the month of March will not appear anywhere in the Cash book.
Rent is an expense and according to the rules of accounting, expenses are recorded on the payment side of the Cash book. However, as the question mentions that the rent is due for the month of March, it means that it has not been paid yet. Hence, it will not appear anywhere in the Cash book for the month of March.
Since the rent is due and has not been paid, it cannot be recorded on the receipt side of the Cash book. Also, it cannot be recorded as a contra entry because a contra entry is a transaction that involves both cash and bank accounts, and in this case, only the rent account is involved.
Therefore, the correct answer is option 'D' which states that the rent due for the month of March will not appear anywhere in the Cash book.
If Ram has sold goods for cash, the entry will be recorded- a)In the Cash Book
- b)In the Sales Book
- c)In the Journal
- d)In the Inventory Book
Correct answer is option 'A'. Can you explain this answer?
If Ram has sold goods for cash, the entry will be recorded
a)
In the Cash Book
b)
In the Sales Book
c)
In the Journal
d)
In the Inventory Book
|
Aman Chaudhary answered |
Answer:
Recording Sales for Cash in Accounting
When a business entity sells goods or services for cash, it needs to record the transaction in its accounting books. The entry for such a transaction will be recorded in the Cash Book, which is a subsidiary book that records all cash receipts and payments.
Reasons for Recording Sales in Cash Book
1. To maintain accurate records of cash transactions.
2. To reconcile the cash balance in the bank account with the cash balance in the Cash Book.
3. To track the cash flow of the business and monitor its liquidity.
Steps Involved in Recording Sales in Cash Book
1. Determine the amount of cash received from the sale of goods or services.
2. Record the transaction in the Cash Book by debiting the cash account and crediting the sales account.
3. Verify the accuracy of the entry by cross-checking it with the sales invoice issued to the customer.
4. Update the ledger accounts and trial balance to reflect the transaction.
Conclusion
In conclusion, the entry for sales made for cash is recorded in the Cash Book of the business. This helps the business to maintain accurate records of cash transactions, reconcile the cash balance, and monitor its liquidity.
Recording Sales for Cash in Accounting
When a business entity sells goods or services for cash, it needs to record the transaction in its accounting books. The entry for such a transaction will be recorded in the Cash Book, which is a subsidiary book that records all cash receipts and payments.
Reasons for Recording Sales in Cash Book
1. To maintain accurate records of cash transactions.
2. To reconcile the cash balance in the bank account with the cash balance in the Cash Book.
3. To track the cash flow of the business and monitor its liquidity.
Steps Involved in Recording Sales in Cash Book
1. Determine the amount of cash received from the sale of goods or services.
2. Record the transaction in the Cash Book by debiting the cash account and crediting the sales account.
3. Verify the accuracy of the entry by cross-checking it with the sales invoice issued to the customer.
4. Update the ledger accounts and trial balance to reflect the transaction.
Conclusion
In conclusion, the entry for sales made for cash is recorded in the Cash Book of the business. This helps the business to maintain accurate records of cash transactions, reconcile the cash balance, and monitor its liquidity.
The balance in the petty cash book is- a)An expense
- b)A Profit
- c)An asset.
- d)A liability
Correct answer is option 'C'. Can you explain this answer?
The balance in the petty cash book is
a)
An expense
b)
A Profit
c)
An asset.
d)
A liability
|
|
Rishika Kumar answered |
Explanation:
Petty cash is a small amount of cash that is kept on hand by a business to pay for small expenses like postage, office supplies, or other miscellaneous expenses. The balance in the petty cash book is an asset because it represents the amount of cash that the business has on hand.
Assets: Assets are resources that a company owns that have value and can be used to generate revenue. They include cash, accounts receivable, inventory, property, plant, and equipment.
Liabilities: Liabilities are obligations that a company owes to others. They include accounts payable, loans payable, and other debts.
Expenses: Expenses are costs that a company incurs in order to generate revenue. They include salaries and wages, rent, utilities, and other costs.
Profit: Profit is the difference between revenue and expenses. If revenue is greater than expenses, the company has a profit. If expenses are greater than revenue, the company has a loss.
In summary, the balance in the petty cash book is an asset because it represents the amount of cash that the business has on hand.
Petty cash is a small amount of cash that is kept on hand by a business to pay for small expenses like postage, office supplies, or other miscellaneous expenses. The balance in the petty cash book is an asset because it represents the amount of cash that the business has on hand.
Assets: Assets are resources that a company owns that have value and can be used to generate revenue. They include cash, accounts receivable, inventory, property, plant, and equipment.
Liabilities: Liabilities are obligations that a company owes to others. They include accounts payable, loans payable, and other debts.
Expenses: Expenses are costs that a company incurs in order to generate revenue. They include salaries and wages, rent, utilities, and other costs.
Profit: Profit is the difference between revenue and expenses. If revenue is greater than expenses, the company has a profit. If expenses are greater than revenue, the company has a loss.
In summary, the balance in the petty cash book is an asset because it represents the amount of cash that the business has on hand.
Cash book is a form of : - a)Trial Balance
- b)Ledger
- c)Journal
- d)All of the above
Correct answer is option 'B'. Can you explain this answer?
Cash book is a form of :
a)
Trial Balance
b)
Ledger
c)
Journal
d)
All of the above
|
Rajat Patel answered |
Journal in which all cash receipts and payments (including bank deposits and withdrawals) are recorded first, in chronological order, for posting to general ledger.
While balancing three column cash book, the discount columns are:- a)Totaled but not adjusted
- b)Totaled and also adjusted
- c)Totaled but not balanced
- d)Balanced but not totaled
Correct answer is option 'C'. Can you explain this answer?
While balancing three column cash book, the discount columns are:
a)
Totaled but not adjusted
b)
Totaled and also adjusted
c)
Totaled but not balanced
d)
Balanced but not totaled
|
|
Akshay Das answered |
Balancing Discount Columns in Three Column Cash Book
Discount columns are maintained in the three column cash book to record the discounts allowed and received on cash and credit transactions. While balancing the three column cash book, the discount columns are treated in a specific manner. The correct option is 'C', i.e., totaled but not balanced.
Explanation:
Totaling of Discount Columns:
During the process of balancing the three column cash book, the discount columns are totaled separately. The totals of both the discount columns are transferred to the debit and credit sides of the discount account respectively.
Not Adjusted:
After totaling the discount columns, the balances are not adjusted. Instead, the discount account is balanced with the help of the discounts allowed and received on credit transactions.
Not Balanced:
The discount columns are not balanced as they do not affect the double-entry system. They are merely used to record the discounts allowed and received on cash and credit transactions. Therefore, the discount columns are totaled but not balanced during the process of balancing the three column cash book.
Conclusion:
In conclusion, while balancing the three column cash book, the discount columns are totaled but not adjusted and balanced. The totals of both the discount columns are transferred to the debit and credit sides of the discount account respectively. This is done to record the discounts allowed and received on cash and credit transactions.
Discount columns are maintained in the three column cash book to record the discounts allowed and received on cash and credit transactions. While balancing the three column cash book, the discount columns are treated in a specific manner. The correct option is 'C', i.e., totaled but not balanced.
Explanation:
Totaling of Discount Columns:
During the process of balancing the three column cash book, the discount columns are totaled separately. The totals of both the discount columns are transferred to the debit and credit sides of the discount account respectively.
Not Adjusted:
After totaling the discount columns, the balances are not adjusted. Instead, the discount account is balanced with the help of the discounts allowed and received on credit transactions.
Not Balanced:
The discount columns are not balanced as they do not affect the double-entry system. They are merely used to record the discounts allowed and received on cash and credit transactions. Therefore, the discount columns are totaled but not balanced during the process of balancing the three column cash book.
Conclusion:
In conclusion, while balancing the three column cash book, the discount columns are totaled but not adjusted and balanced. The totals of both the discount columns are transferred to the debit and credit sides of the discount account respectively. This is done to record the discounts allowed and received on cash and credit transactions.
While balancing three column cash book, the discount columns are:
- a)Totaled but not adjusted
- b)Totaled and also adjusted
- c)Totaled but not balanced
- d)Balanced but not totaled
Correct answer is option 'C'. Can you explain this answer?
While balancing three column cash book, the discount columns are:
a)
Totaled but not adjusted
b)
Totaled and also adjusted
c)
Totaled but not balanced
d)
Balanced but not totaled
|
|
Rajat Patel answered |
When three column cash book is kept, discount columns are totaled but not balanced. Total of debit side discount column will be transferred to debit side of P/L A/c and total of credit side discount column will be transferred to credit side of P/L A/c.
Cheques received but deposited on the next day are recorded in : - a)Cash column of the cash book
- b)Bank column of the cash book
- c)Both of these
- d)None of these
Correct answer is option 'A'. Can you explain this answer?
Cheques received but deposited on the next day are recorded in :
a)
Cash column of the cash book
b)
Bank column of the cash book
c)
Both of these
d)
None of these
|
Arjun Singhania answered |
When a business house receives a cheque it is entered in the bank column on the receipt side if paid into the bank on the same day. If the cheque is not deposited in the bank on the same day then it is entered in the cash column of the cash book when it is received. When the cheque is deposited in the bank a contra entry is passed.
Cash book is a type of _______ but treated as a ________ of accounts. - a)Subsidiary book, principal book
- b)Principal book, subsidiary book
- c)Subsidiary book, Subsidiary book
- d)Principal book, Principal book
Correct answer is option 'A'. Can you explain this answer?
Cash book is a type of _______ but treated as a ________ of accounts.
a)
Subsidiary book, principal book
b)
Principal book, subsidiary book
c)
Subsidiary book, Subsidiary book
d)
Principal book, Principal book
|
|
Vaishnavi Gupta answered |
Subsidiary book and Principal book
A cash book is a type of subsidiary book that is treated as a principal book of accounts. Let's understand what these terms mean and why the correct answer is option 'A'.
Subsidiary book:
- A subsidiary book is a book of original entry used to record specific types of transactions in a systematic manner.
- It is a subsidiary to the main or principal book of accounts, which is the ledger.
- Subsidiary books help in maintaining a detailed record of transactions before they are posted to the ledger.
Principal book:
- The principal book of accounts is the ledger, which is a collection of all accounts maintained by a business.
- It serves as the central repository for recording and summarizing all financial transactions.
- The ledger provides a detailed record of each account, including its opening and closing balances, as well as all transactions affecting the account.
Cash book:
- A cash book is a type of subsidiary book used to record cash and bank transactions.
- It acts as a record of all cash receipts and payments, as well as bank receipts and payments.
- The cash book helps in maintaining an accurate record of cash and bank balances, and it is updated on a regular basis.
Cash book as a subsidiary book:
- The cash book is considered a subsidiary book because it records specific types of transactions (cash and bank).
- These transactions are later posted to the respective accounts in the ledger.
- The cash book serves as a subsidiary to the ledger, providing a detailed record of cash and bank transactions before they are summarized in the ledger.
Cash book as a principal book:
- While the cash book is a subsidiary book, it is also treated as a principal book of accounts.
- This is because the cash book contains important financial information that is used for various purposes, such as preparing financial statements, analyzing cash flows, and monitoring cash and bank balances.
- The cash book is often referred to as the "bank account" of a business, as it provides a detailed record of all cash and bank transactions.
Conclusion:
In conclusion, a cash book is a type of subsidiary book that is treated as a principal book of accounts. It serves as a detailed record of cash and bank transactions, acting as a subsidiary to the ledger while also providing important financial information as a principal book.
A cash book is a type of subsidiary book that is treated as a principal book of accounts. Let's understand what these terms mean and why the correct answer is option 'A'.
Subsidiary book:
- A subsidiary book is a book of original entry used to record specific types of transactions in a systematic manner.
- It is a subsidiary to the main or principal book of accounts, which is the ledger.
- Subsidiary books help in maintaining a detailed record of transactions before they are posted to the ledger.
Principal book:
- The principal book of accounts is the ledger, which is a collection of all accounts maintained by a business.
- It serves as the central repository for recording and summarizing all financial transactions.
- The ledger provides a detailed record of each account, including its opening and closing balances, as well as all transactions affecting the account.
Cash book:
- A cash book is a type of subsidiary book used to record cash and bank transactions.
- It acts as a record of all cash receipts and payments, as well as bank receipts and payments.
- The cash book helps in maintaining an accurate record of cash and bank balances, and it is updated on a regular basis.
Cash book as a subsidiary book:
- The cash book is considered a subsidiary book because it records specific types of transactions (cash and bank).
- These transactions are later posted to the respective accounts in the ledger.
- The cash book serves as a subsidiary to the ledger, providing a detailed record of cash and bank transactions before they are summarized in the ledger.
Cash book as a principal book:
- While the cash book is a subsidiary book, it is also treated as a principal book of accounts.
- This is because the cash book contains important financial information that is used for various purposes, such as preparing financial statements, analyzing cash flows, and monitoring cash and bank balances.
- The cash book is often referred to as the "bank account" of a business, as it provides a detailed record of all cash and bank transactions.
Conclusion:
In conclusion, a cash book is a type of subsidiary book that is treated as a principal book of accounts. It serves as a detailed record of cash and bank transactions, acting as a subsidiary to the ledger while also providing important financial information as a principal book.
Postage stamps purchased for Rs. 30 by business. This transaction will be recorded in:- a)Purchase book
- b)Cash Book
- c)Petty Cash Book
- d)Journal
Correct answer is option 'C'. Can you explain this answer?
Postage stamps purchased for Rs. 30 by business. This transaction will be recorded in:
a)
Purchase book
b)
Cash Book
c)
Petty Cash Book
d)
Journal
|
|
Arka Kaur answered |
Understanding the Transaction
When a business purchases postage stamps for Rs. 30, it's essential to classify this transaction correctly in the accounting records.
Nature of the Expense
- Postage stamps are considered a minor expense and are generally used for mailing purposes.
- Such expenses do not represent a significant outflow of cash or inventory but rather a small operational cost.
Why Petty Cash Book?
- Small Amount: The transaction amount (Rs. 30) is relatively low, making it suitable for the petty cash system, which is designed to handle small, everyday expenses.
- Convenience: Petty cash books are used for quick and easy tracking of minor expenditures without needing extensive documentation.
- Immediate Recording: Since postage stamps are often purchased on an as-needed basis, recording them in the petty cash book allows for immediate accounting, simplifying the tracking of small expenses.
Other Options Explained
- Purchase Book: This book is used for recording credit purchases of goods, not for services or minor expenses like postage.
- Cash Book: While it records all cash transactions, it’s primarily for larger cash transactions and sales, not petty expenses.
- Journal: The journal is used for recording significant transactions that require detailed explanations, which is not the case with a simple postage stamp purchase.
Conclusion
Hence, the correct option is 'C', as the purchase of postage stamps for Rs. 30 is best recorded in the Petty Cash Book, reflecting the nature of the transaction accurately.
When a business purchases postage stamps for Rs. 30, it's essential to classify this transaction correctly in the accounting records.
Nature of the Expense
- Postage stamps are considered a minor expense and are generally used for mailing purposes.
- Such expenses do not represent a significant outflow of cash or inventory but rather a small operational cost.
Why Petty Cash Book?
- Small Amount: The transaction amount (Rs. 30) is relatively low, making it suitable for the petty cash system, which is designed to handle small, everyday expenses.
- Convenience: Petty cash books are used for quick and easy tracking of minor expenditures without needing extensive documentation.
- Immediate Recording: Since postage stamps are often purchased on an as-needed basis, recording them in the petty cash book allows for immediate accounting, simplifying the tracking of small expenses.
Other Options Explained
- Purchase Book: This book is used for recording credit purchases of goods, not for services or minor expenses like postage.
- Cash Book: While it records all cash transactions, it’s primarily for larger cash transactions and sales, not petty expenses.
- Journal: The journal is used for recording significant transactions that require detailed explanations, which is not the case with a simple postage stamp purchase.
Conclusion
Hence, the correct option is 'C', as the purchase of postage stamps for Rs. 30 is best recorded in the Petty Cash Book, reflecting the nature of the transaction accurately.
What rate of commission is charged by the bank issuing the credit card : - a)1% to 3%
- b)3% to 6%
- c)2% to 5%
- d)1% to 4%
Correct answer is option 'D'. Can you explain this answer?
What rate of commission is charged by the bank issuing the credit card :
a)
1% to 3%
b)
3% to 6%
c)
2% to 5%
d)
1% to 4%
|
|
Anuj Roy answered |
Commission charged by the Bank Issuing Credit Card
The rate of commission charged by the bank issuing the credit card is an important factor to consider while choosing a credit card. The correct answer is option 'D' which states that the rate of commission charged by the bank issuing the credit card is between 1% to 4%.
Factors affecting the commission rate:
There are several factors that affect the commission rate charged by the bank. Some of the important factors include:
1. Credit Limit: The commission rate charged by the bank is directly proportional to the credit limit offered to the customer. Higher the credit limit, higher is the commission rate charged by the bank.
2. Credit Score: The credit score of the customer is an important factor that determines the commission rate charged by the bank. If the credit score of the customer is good, then the commission rate charged by the bank will be lower.
3. Type of Card: The commission rate charged by the bank varies depending on the type of credit card. For example, the commission rate charged for a premium credit card is higher than the commission rate charged for a regular credit card.
4. Rewards and Benefits: The commission rate charged by the bank is also influenced by the rewards and benefits offered by the credit card. If the credit card offers more rewards and benefits, then the commission rate charged by the bank will be higher.
Conclusion:
In conclusion, the rate of commission charged by the bank issuing the credit card is an important factor to consider while choosing a credit card. The commission rate varies depending on several factors such as credit limit, credit score, type of card, and rewards and benefits offered. It is advisable to compare the commission rates of different credit cards before choosing one that suits your needs.
The rate of commission charged by the bank issuing the credit card is an important factor to consider while choosing a credit card. The correct answer is option 'D' which states that the rate of commission charged by the bank issuing the credit card is between 1% to 4%.
Factors affecting the commission rate:
There are several factors that affect the commission rate charged by the bank. Some of the important factors include:
1. Credit Limit: The commission rate charged by the bank is directly proportional to the credit limit offered to the customer. Higher the credit limit, higher is the commission rate charged by the bank.
2. Credit Score: The credit score of the customer is an important factor that determines the commission rate charged by the bank. If the credit score of the customer is good, then the commission rate charged by the bank will be lower.
3. Type of Card: The commission rate charged by the bank varies depending on the type of credit card. For example, the commission rate charged for a premium credit card is higher than the commission rate charged for a regular credit card.
4. Rewards and Benefits: The commission rate charged by the bank is also influenced by the rewards and benefits offered by the credit card. If the credit card offers more rewards and benefits, then the commission rate charged by the bank will be higher.
Conclusion:
In conclusion, the rate of commission charged by the bank issuing the credit card is an important factor to consider while choosing a credit card. The commission rate varies depending on several factors such as credit limit, credit score, type of card, and rewards and benefits offered. It is advisable to compare the commission rates of different credit cards before choosing one that suits your needs.
The total of discounts column on the debit side of the cash book, recording cash discount deducted by customers when paying their accounts, is posted to the- a)credit of the discount allowed account.
- b)debit of the discount received account.
- c)credit of the discount received account.
- d)debit of the discount allowed account.
Correct answer is option 'D'. Can you explain this answer?
The total of discounts column on the debit side of the cash book, recording cash discount deducted by customers when paying their accounts, is posted to the
a)
credit of the discount allowed account.
b)
debit of the discount received account.
c)
credit of the discount received account.
d)
debit of the discount allowed account.
|
|
Dipika Kaur answered |
Explanation:
The discounts received by a business are recorded in the discount allowed account, which is a nominal account. Similarly, the discounts allowed by a business are recorded in the discount received account, which is also a nominal account.
When the customers pay their accounts, they deduct a certain amount of cash discount, which is recorded in the cash book on the debit side under the column “Discounts”. This amount represents the discounts allowed by the business to its customers.
To post the total of discounts column on the debit side of the cash book, we need to consider the following points:
- The cash book is a subsidiary book, which means that all the entries made in it are later posted to the ledger accounts.
- The discounts allowed by the business are recorded on the debit side of the cash book, which means that they need to be credited to the discount allowed account.
- Therefore, the total of discounts column on the debit side of the cash book is posted to the debit side of the discount allowed account.
Conclusion:
Hence, option D (debit of the discount allowed account) is the correct answer.
The discounts received by a business are recorded in the discount allowed account, which is a nominal account. Similarly, the discounts allowed by a business are recorded in the discount received account, which is also a nominal account.
When the customers pay their accounts, they deduct a certain amount of cash discount, which is recorded in the cash book on the debit side under the column “Discounts”. This amount represents the discounts allowed by the business to its customers.
To post the total of discounts column on the debit side of the cash book, we need to consider the following points:
- The cash book is a subsidiary book, which means that all the entries made in it are later posted to the ledger accounts.
- The discounts allowed by the business are recorded on the debit side of the cash book, which means that they need to be credited to the discount allowed account.
- Therefore, the total of discounts column on the debit side of the cash book is posted to the debit side of the discount allowed account.
Conclusion:
Hence, option D (debit of the discount allowed account) is the correct answer.
State which of the following correctly complete the sentences given below:Q.The balance in the petty cash book is- a)an expense
- b)a profit
- c)an asset
- d)a liability.
Correct answer is option 'C'. Can you explain this answer?
State which of the following correctly complete the sentences given below:
Q.The balance in the petty cash book is
a)
an expense
b)
a profit
c)
an asset
d)
a liability.
|
|
Akshat Choudhary answered |
The closing balance of petty cash book is considered as Asset. Petty Cash is a current asset account; it is part of a company's cash.
State which of the following correctly complete the sentences given below:Q.If Ram has sold goods for cash, the entry will be recorded- a)in the Cash Book
- b)in the Sales Book
- c)in the Journal
- d)in the Stock Book.
Correct answer is option 'A'. Can you explain this answer?
State which of the following correctly complete the sentences given below:
Q.If Ram has sold goods for cash, the entry will be recorded
a)
in the Cash Book
b)
in the Sales Book
c)
in the Journal
d)
in the Stock Book.
|
Manoj Meenakshi answered |
In the cash book
Which of the following is not a column of a three-column cash-book?- a)Cash column
- b)Bank column
- c)Petty cash column
- d)Discount column
Correct answer is option 'C'. Can you explain this answer?
Which of the following is not a column of a three-column cash-book?
a)
Cash column
b)
Bank column
c)
Petty cash column
d)
Discount column
|
|
Rajat Patel answered |
A triple column cash book or three column Cash Book is one which consists of three separate columns on the debit side as well as credit side for recording cash, bank and discount. The discount column on the debit side of the cash book will record discounts allowed and that on the credit side discounts received. Discount columns in both side are not balanced only totaled.So, petty cash column is not include in three-column cash-book.
Which of the following is the kind of a cash book?- a)Simple column cash book
- b)Double-column cash book
- c)Three-column cash book
- d)All of the above
Correct answer is option 'D'. Can you explain this answer?
Which of the following is the kind of a cash book?
a)
Simple column cash book
b)
Double-column cash book
c)
Three-column cash book
d)
All of the above
|
|
Rávi Ojha answered |
Option D is correct because cash book is three types single,double and triple.Single column contains only cash transactions and double contains cash and bank, third contains cash bank nd discount
Contra entries are passed only when- a)three-column cash book is prepared
- b)double column cash book is prepared
- c)simple cash book is prepared
- d)None of the above
Correct answer is option 'B'. Can you explain this answer?
Contra entries are passed only when
a)
three-column cash book is prepared
b)
double column cash book is prepared
c)
simple cash book is prepared
d)
None of the above
|
|
Sinjini Gupta answered |
Contra-entry is the entry which effected the both sides in cash book.
It is occured in three times, i.e.,
1.Cash deposited in to bank,
2.Cash withdrawn from the bank for office use, and
3.Receivable cheque deposited in to the bank in another day.
Double entry in Cash Book is completed when : - a)Salaries are paid by cheque
- b)Withdrawal of money from bank for personal use
- c)Deposited cash into bank
- d)None of these
Correct answer is option 'C'. Can you explain this answer?
Double entry in Cash Book is completed when :
a)
Salaries are paid by cheque
b)
Withdrawal of money from bank for personal use
c)
Deposited cash into bank
d)
None of these
|
|
Arka Kaur answered |
Explanation:
Double Entry System is an accounting method that implies that every financial transaction has equal and opposite effects in at least two different accounts. In the Cash Book, double entry is completed when any transaction has been recorded in both debit and credit sides of the book. Let's see the options:
a) Salaries are paid by cheque: When salaries are paid by cheque, it will be recorded as a payment in the bank column of the Cash Book. This transaction will only have one entry in the Cash Book, so it is not a double entry.
b) Withdrawal of money from bank for personal use: When money is withdrawn from the bank for personal use, it will be recorded as a payment in the bank column of the Cash Book. This transaction will also only have one entry in the Cash Book, so it is not a double entry.
c) Deposited cash into bank: When cash is deposited into the bank, it will be recorded as a receipt in the bank column of the Cash Book. This transaction will have two entries, one in the bank column as a receipt and one in the cash column as a payment, completing the double entry.
d) None of these: Option D is not the correct answer as option C is the correct answer.
Therefore, the correct answer is option C, Deposited cash into bank, as it completes the double entry in the Cash Book.
Double Entry System is an accounting method that implies that every financial transaction has equal and opposite effects in at least two different accounts. In the Cash Book, double entry is completed when any transaction has been recorded in both debit and credit sides of the book. Let's see the options:
a) Salaries are paid by cheque: When salaries are paid by cheque, it will be recorded as a payment in the bank column of the Cash Book. This transaction will only have one entry in the Cash Book, so it is not a double entry.
b) Withdrawal of money from bank for personal use: When money is withdrawn from the bank for personal use, it will be recorded as a payment in the bank column of the Cash Book. This transaction will also only have one entry in the Cash Book, so it is not a double entry.
c) Deposited cash into bank: When cash is deposited into the bank, it will be recorded as a receipt in the bank column of the Cash Book. This transaction will have two entries, one in the bank column as a receipt and one in the cash column as a payment, completing the double entry.
d) None of these: Option D is not the correct answer as option C is the correct answer.
Therefore, the correct answer is option C, Deposited cash into bank, as it completes the double entry in the Cash Book.
Petty cash may be used to pay - a)The expenses relating to postage and conveyance.
- b)Salary to administrative staff
- c)For the purchase of furniture and fixtures
- d)For the purchase of raw material.
Correct answer is option 'A'. Can you explain this answer?
Petty cash may be used to pay
a)
The expenses relating to postage and conveyance.
b)
Salary to administrative staff
c)
For the purchase of furniture and fixtures
d)
For the purchase of raw material.
|
Anand Dasgupta answered |
Petty cash is a small amount of cash kept on hand by a business for the purpose of covering small expenses. It is used for day-to-day expenses that are not significant enough to warrant writing a check or using a credit card. Petty cash is typically managed by an appointed employee, known as the petty cash custodian.
Usage of petty cash can vary depending on the needs of each business. However, there are certain expenses that are commonly paid using petty cash. One such expense is postage and conveyance.
Postage refers to the cost of sending mail or packages. Many businesses have regular mailings that need to be sent out, such as invoices, letters, or promotional materials. The cost of postage can be paid using petty cash, as it is a small and frequent expense that can easily be covered from the petty cash fund.
Conveyance refers to the cost of transportation or travel. This can include expenses such as local transportation for business meetings or delivery services. Petty cash can be used to pay for these types of expenses, as they are typically small amounts and occur regularly.
By allowing petty cash to be used for postage and conveyance expenses, businesses can ensure that these costs are effectively managed and paid for in a timely manner. It also eliminates the need for employees to submit expense reports or reimbursement requests for small and routine expenses.
It is important to note that petty cash should not be used for salary payments (option B). Salaries are typically larger expenses that are paid on a regular basis and should be accounted for separately. Paying salaries from petty cash could result in inadequate recordkeeping and a lack of transparency in the payroll process.
Similarly, the purchase of furniture and fixtures (option C) and the purchase of raw material (option D) are not suitable uses for petty cash. These types of expenses are typically larger and should be properly tracked and documented in the business's accounting system.
In conclusion, petty cash is commonly used to pay for expenses relating to postage and conveyance. This allows businesses to effectively manage and cover small and routine expenses without the need for formal reimbursement processes. However, it is important to ensure that petty cash is not used for larger expenses such as salaries, furniture, fixtures, or raw materials.
Usage of petty cash can vary depending on the needs of each business. However, there are certain expenses that are commonly paid using petty cash. One such expense is postage and conveyance.
Postage refers to the cost of sending mail or packages. Many businesses have regular mailings that need to be sent out, such as invoices, letters, or promotional materials. The cost of postage can be paid using petty cash, as it is a small and frequent expense that can easily be covered from the petty cash fund.
Conveyance refers to the cost of transportation or travel. This can include expenses such as local transportation for business meetings or delivery services. Petty cash can be used to pay for these types of expenses, as they are typically small amounts and occur regularly.
By allowing petty cash to be used for postage and conveyance expenses, businesses can ensure that these costs are effectively managed and paid for in a timely manner. It also eliminates the need for employees to submit expense reports or reimbursement requests for small and routine expenses.
It is important to note that petty cash should not be used for salary payments (option B). Salaries are typically larger expenses that are paid on a regular basis and should be accounted for separately. Paying salaries from petty cash could result in inadequate recordkeeping and a lack of transparency in the payroll process.
Similarly, the purchase of furniture and fixtures (option C) and the purchase of raw material (option D) are not suitable uses for petty cash. These types of expenses are typically larger and should be properly tracked and documented in the business's accounting system.
In conclusion, petty cash is commonly used to pay for expenses relating to postage and conveyance. This allows businesses to effectively manage and cover small and routine expenses without the need for formal reimbursement processes. However, it is important to ensure that petty cash is not used for larger expenses such as salaries, furniture, fixtures, or raw materials.
State which of the following correctly complete the sentences given below:Q.The Cash Book records- a)all cash receipts
- b)all cash payments
- c)all cash receipts and payments
- d)cash and credit sale of goods.
Correct answer is option 'C'. Can you explain this answer?
State which of the following correctly complete the sentences given below:
Q.The Cash Book records
a)
all cash receipts
b)
all cash payments
c)
all cash receipts and payments
d)
cash and credit sale of goods.
|
Shriyanshu Keshari answered |
3 rd is right answer as a cash book record all cash receipts and payment
The Cash Book records - a)All cash payments
- b)All cash payments
- c)All cash receipts and payments
- d)Cash and credit sale of goods.
Correct answer is option 'C'. Can you explain this answer?
The Cash Book records
a)
All cash payments
b)
All cash payments
c)
All cash receipts and payments
d)
Cash and credit sale of goods.
|
|
Mrinalini Iyer answered |
**The Cash Book records all cash receipts and payments.**
The Cash Book is a special type of ledger that is used to record all cash transactions of a business. It plays a crucial role in maintaining the financial records and ensuring accurate and up-to-date information about the cash inflows and outflows.
**Understanding the options:**
a) All cash payments: This option suggests that the Cash Book records only cash payments made by the business. However, this is not correct as the Cash Book also records cash receipts.
b) All cash receipts: This option suggests that the Cash Book records only cash receipts received by the business. Again, this is not accurate as the Cash Book also records cash payments.
c) All cash receipts and payments: This option correctly states that the Cash Book records both cash receipts and payments. It provides a comprehensive record of all cash transactions, giving a clear picture of the cash flow of the business.
d) Cash and credit sale of goods: This option suggests that the Cash Book records both cash and credit sales of goods. While the Cash Book does record cash sales, credit sales are typically recorded in a separate ledger called the Sales Ledger or Accounts Receivable Ledger.
**Explanation:**
The Cash Book is divided into two sides: the debit side and the credit side. The debit side records all cash receipts, while the credit side records all cash payments. Each transaction is recorded with a date, description, and amount.
Cash receipts include cash sales, cash received from debtors, cash received from loans or investments, and any other cash inflows. Cash payments include cash purchases, cash paid to creditors, cash expenses, and any other cash outflows.
By recording all cash receipts and payments in the Cash Book, businesses can easily track their cash position, monitor cash inflows and outflows, and reconcile their cash balance with the bank statement. This helps in maintaining proper control over cash, detecting any discrepancies or errors, and ensuring the accuracy of financial statements.
Overall, the Cash Book serves as a primary tool for recording, analyzing, and managing cash transactions in a business. It provides a complete record of all cash receipts and payments and forms an integral part of the financial accounting system.
The Cash Book is a special type of ledger that is used to record all cash transactions of a business. It plays a crucial role in maintaining the financial records and ensuring accurate and up-to-date information about the cash inflows and outflows.
**Understanding the options:**
a) All cash payments: This option suggests that the Cash Book records only cash payments made by the business. However, this is not correct as the Cash Book also records cash receipts.
b) All cash receipts: This option suggests that the Cash Book records only cash receipts received by the business. Again, this is not accurate as the Cash Book also records cash payments.
c) All cash receipts and payments: This option correctly states that the Cash Book records both cash receipts and payments. It provides a comprehensive record of all cash transactions, giving a clear picture of the cash flow of the business.
d) Cash and credit sale of goods: This option suggests that the Cash Book records both cash and credit sales of goods. While the Cash Book does record cash sales, credit sales are typically recorded in a separate ledger called the Sales Ledger or Accounts Receivable Ledger.
**Explanation:**
The Cash Book is divided into two sides: the debit side and the credit side. The debit side records all cash receipts, while the credit side records all cash payments. Each transaction is recorded with a date, description, and amount.
Cash receipts include cash sales, cash received from debtors, cash received from loans or investments, and any other cash inflows. Cash payments include cash purchases, cash paid to creditors, cash expenses, and any other cash outflows.
By recording all cash receipts and payments in the Cash Book, businesses can easily track their cash position, monitor cash inflows and outflows, and reconcile their cash balance with the bank statement. This helps in maintaining proper control over cash, detecting any discrepancies or errors, and ensuring the accuracy of financial statements.
Overall, the Cash Book serves as a primary tool for recording, analyzing, and managing cash transactions in a business. It provides a complete record of all cash receipts and payments and forms an integral part of the financial accounting system.
Chapter doubts & questions for Unit 5: Cash Book - Accounting for CA Foundation 2025 is part of CA Foundation exam preparation. The chapters have been prepared according to the CA Foundation exam syllabus. The Chapter doubts & questions, notes, tests & MCQs are made for CA Foundation 2025 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests here.
Chapter doubts & questions of Unit 5: Cash Book - Accounting for CA Foundation in English & Hindi are available as part of CA Foundation exam.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Accounting for CA Foundation
68 videos|160 docs|83 tests
|
Signup to see your scores go up within 7 days!
Study with 1000+ FREE Docs, Videos & Tests
10M+ students study on EduRev
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup