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Comments business with rupees 100000 of which rupees 20000 were bore from Mr Ratan how to record in this transaction in cash book with proper format?
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Comments business with rupees 100000 of which rupees 20000 were bore f...
Recording the Transaction in Cash Book
When recording the transaction of receiving a total of rupees 100,000, of which rupees 20,000 were borrowed from Mr. Ratan, it's essential to clearly differentiate between the cash inflow from the business and the borrowed amount. This helps maintain accurate accounts and provides clarity for future reference.
Cash Book Format
The cash book typically has two main columns: one for cash receipts and one for cash payments. Here’s how to format the entries for this transaction:
Cash Book Entry
- Date: [Insert Date]
- Particulars: Cash Account
- Receipts (Debit Side):
- Rs. 100,000 (Total Cash Received)
- Particulars: Loan from Mr. Ratan
- Receipts (Debit Side):
- Rs. 20,000 (Loan Amount)
- Total Cash on Hand:
- Rs. 120,000 (Total cash in hand after borrowing)
Explanation of Entries
- Total Cash Received: This entry reflects the total cash inflow into the business, which includes the borrowed funds.
- Loan from Mr. Ratan: This entry specifies the amount borrowed, distinguishing it from the business revenue. It is crucial to note that this is a liability, indicating that the amount must be repaid.
Conclusion
Recording this transaction accurately ensures that the cash book reflects the true financial position of the business. Proper documentation is vital for effective financial management and for future audits or reviews.
When recording the transaction of receiving a total of rupees 100,000, of which rupees 20,000 were borrowed from Mr. Ratan, it's essential to clearly differentiate between the cash inflow from the business and the borrowed amount. This helps maintain accurate accounts and provides clarity for future reference.
Cash Book Format
The cash book typically has two main columns: one for cash receipts and one for cash payments. Here’s how to format the entries for this transaction:
Cash Book Entry
- Date: [Insert Date]
- Particulars: Cash Account
- Receipts (Debit Side):
- Rs. 100,000 (Total Cash Received)
- Particulars: Loan from Mr. Ratan
- Receipts (Debit Side):
- Rs. 20,000 (Loan Amount)
- Total Cash on Hand:
- Rs. 120,000 (Total cash in hand after borrowing)
Explanation of Entries
- Total Cash Received: This entry reflects the total cash inflow into the business, which includes the borrowed funds.
- Loan from Mr. Ratan: This entry specifies the amount borrowed, distinguishing it from the business revenue. It is crucial to note that this is a liability, indicating that the amount must be repaid.
Conclusion
Recording this transaction accurately ensures that the cash book reflects the true financial position of the business. Proper documentation is vital for effective financial management and for future audits or reviews.
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Comments business with rupees 100000 of which rupees 20000 were bore from Mr Ratan how to record in this transaction in cash book with proper format?
Question Description
Comments business with rupees 100000 of which rupees 20000 were bore from Mr Ratan how to record in this transaction in cash book with proper format? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Comments business with rupees 100000 of which rupees 20000 were bore from Mr Ratan how to record in this transaction in cash book with proper format? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Comments business with rupees 100000 of which rupees 20000 were bore from Mr Ratan how to record in this transaction in cash book with proper format?.
Comments business with rupees 100000 of which rupees 20000 were bore from Mr Ratan how to record in this transaction in cash book with proper format? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Comments business with rupees 100000 of which rupees 20000 were bore from Mr Ratan how to record in this transaction in cash book with proper format? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Comments business with rupees 100000 of which rupees 20000 were bore from Mr Ratan how to record in this transaction in cash book with proper format?.
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