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A bill for Rs. 6900 discounted with the bank is entered in the cash book with recording the discount charge of Rs. 800 (overdraft as per cash book is given) tell me whether plus side or minus side?
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A bill for Rs. 6900 discounted with the bank is entered in the cash bo...
Answer:
The entry for the bill discounted with the bank will have two aspects - the amount of the bill and the discount charge. The cash book's given overdraft balance needs to be considered while recording the entry.
Record the Bill Discounted Entry:
The entry for the bill discounted with the bank will be as follows:
Bank Account Dr. 6900
Discount Received Cr. 800
To Cash Account Cr. 6100
The above entry will be recorded in the cash book as follows:
Date Particulars L.F. Debit Credit
DD/MM/YYYY Bank Account 6900
Discount Received 800
To Cash Account 6100
Balance C/D 6900
Explanation:
The entry for the bill discounted with the bank is recorded on the debit side of the Bank Account as it is an outgoing payment. The Discount Received account is credited with the discount charge of Rs. 800. The Cash Account is credited with the net amount paid to the bank, which is Rs. 6100 after deducting the discount amount.
The balance carried down (C/D) in the cash book will be Rs. 6900, which is the same as the given overdraft balance. Therefore, the overdraft balance in the cash book remains the same.
Conclusion:
To summarise, the entry for the bill discounted with the bank will have a debit entry for the Bank Account, a credit entry for the Discount Received account, and a credit entry for the Cash Account. The overdraft balance in the cash book remains the same.
The entry for the bill discounted with the bank will have two aspects - the amount of the bill and the discount charge. The cash book's given overdraft balance needs to be considered while recording the entry.
Record the Bill Discounted Entry:
The entry for the bill discounted with the bank will be as follows:
Bank Account Dr. 6900
Discount Received Cr. 800
To Cash Account Cr. 6100
The above entry will be recorded in the cash book as follows:
Date Particulars L.F. Debit Credit
DD/MM/YYYY Bank Account 6900
Discount Received 800
To Cash Account 6100
Balance C/D 6900
Explanation:
The entry for the bill discounted with the bank is recorded on the debit side of the Bank Account as it is an outgoing payment. The Discount Received account is credited with the discount charge of Rs. 800. The Cash Account is credited with the net amount paid to the bank, which is Rs. 6100 after deducting the discount amount.
The balance carried down (C/D) in the cash book will be Rs. 6900, which is the same as the given overdraft balance. Therefore, the overdraft balance in the cash book remains the same.
Conclusion:
To summarise, the entry for the bill discounted with the bank will have a debit entry for the Bank Account, a credit entry for the Discount Received account, and a credit entry for the Cash Account. The overdraft balance in the cash book remains the same.
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A bill for Rs. 6900 discounted with the bank is entered in the cash book with recording the discount charge of Rs. 800 (overdraft as per cash book is given) tell me whether plus side or minus side?
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A bill for Rs. 6900 discounted with the bank is entered in the cash book with recording the discount charge of Rs. 800 (overdraft as per cash book is given) tell me whether plus side or minus side? for Class 11 2024 is part of Class 11 preparation. The Question and answers have been prepared according to the Class 11 exam syllabus. Information about A bill for Rs. 6900 discounted with the bank is entered in the cash book with recording the discount charge of Rs. 800 (overdraft as per cash book is given) tell me whether plus side or minus side? covers all topics & solutions for Class 11 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A bill for Rs. 6900 discounted with the bank is entered in the cash book with recording the discount charge of Rs. 800 (overdraft as per cash book is given) tell me whether plus side or minus side?.
A bill for Rs. 6900 discounted with the bank is entered in the cash book with recording the discount charge of Rs. 800 (overdraft as per cash book is given) tell me whether plus side or minus side? for Class 11 2024 is part of Class 11 preparation. The Question and answers have been prepared according to the Class 11 exam syllabus. Information about A bill for Rs. 6900 discounted with the bank is entered in the cash book with recording the discount charge of Rs. 800 (overdraft as per cash book is given) tell me whether plus side or minus side? covers all topics & solutions for Class 11 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A bill for Rs. 6900 discounted with the bank is entered in the cash book with recording the discount charge of Rs. 800 (overdraft as per cash book is given) tell me whether plus side or minus side?.
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