Short Question Answer - Recording of Transactions 2 Class 11 Notes | EduRev

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Class 11 : Short Question Answer - Recording of Transactions 2 Class 11 Notes | EduRev

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CHAPTER 4- RECORDING OF TRANSACTIONS 2 
 
Q1 Briefly state how the cash book is both journal and a ledger? 
Ans1 Cash Book is a journal in the sense that all the transactions relating to receipt or 
payment of cash are recorded only in Cash Book and not in the journal. Cash Book is a ledger 
also because there is no need to open a separate account in the ledger. In ease of Cash Book. 
only one posting is required unlike in journal where two postings are required. Cash Book is 
ruled like a ledger account. 
Q.2. What is the purpose of contra entry ? 
Ans. The purpose of contra entry is to indicate that such entries do not require any posting in the 
ledger because contra entries ure recorded on both the sides of the Cash Book 
Q.3. What are special purpose books ? 
Ans.Special purpose books are the books of original entry to replace the journal. Each special 
purpose book is meant for recording all the transactions of a similar nature. Following arc special 
purpose books : (i)  Ctish Book (ii) Purchases Book (iii) Purchases Return Book 
(iv) Sales Book 
(v) Sales Return Book 
(vi) Bills Receivable Book 
(vii) Bills Payable Book 
(viii) Journal Proper. 
Q.4. What Is petty cash book ? How is it prepared ? 
Ans.Petty Cash Book refers to a specialised cash book which is used by a petty cashier to record all 
the small payments. 
Amount received from the head cashier is recorded on the debit side while the payments are recorded 
on the credit side. Normally. petty cash Is maintained on the basis of imprest system. Accordingly. at 
the end of the month. petty cashier is reimbursed the money. he has already spent. 
Q.5. Explain the meaning of posting of journal entries. 
Ans.Posting is the process of entering in the ledger. the information given in the journals. 
Q.6. Define the purpose of maintaining subsidiary journal. 
Page 2


 
CHAPTER 4- RECORDING OF TRANSACTIONS 2 
 
Q1 Briefly state how the cash book is both journal and a ledger? 
Ans1 Cash Book is a journal in the sense that all the transactions relating to receipt or 
payment of cash are recorded only in Cash Book and not in the journal. Cash Book is a ledger 
also because there is no need to open a separate account in the ledger. In ease of Cash Book. 
only one posting is required unlike in journal where two postings are required. Cash Book is 
ruled like a ledger account. 
Q.2. What is the purpose of contra entry ? 
Ans. The purpose of contra entry is to indicate that such entries do not require any posting in the 
ledger because contra entries ure recorded on both the sides of the Cash Book 
Q.3. What are special purpose books ? 
Ans.Special purpose books are the books of original entry to replace the journal. Each special 
purpose book is meant for recording all the transactions of a similar nature. Following arc special 
purpose books : (i)  Ctish Book (ii) Purchases Book (iii) Purchases Return Book 
(iv) Sales Book 
(v) Sales Return Book 
(vi) Bills Receivable Book 
(vii) Bills Payable Book 
(viii) Journal Proper. 
Q.4. What Is petty cash book ? How is it prepared ? 
Ans.Petty Cash Book refers to a specialised cash book which is used by a petty cashier to record all 
the small payments. 
Amount received from the head cashier is recorded on the debit side while the payments are recorded 
on the credit side. Normally. petty cash Is maintained on the basis of imprest system. Accordingly. at 
the end of the month. petty cashier is reimbursed the money. he has already spent. 
Q.5. Explain the meaning of posting of journal entries. 
Ans.Posting is the process of entering in the ledger. the information given in the journals. 
Q.6. Define the purpose of maintaining subsidiary journal. 
Ans. 1'he purpose of maintaining subsidiary journal is to facilitate division of work among the 
employees which facilitates easy availability of information relating to the desired activity. 
Q.7. Write the difference between return outwards and return inwards . 
Ans. Return outwards means the goods which are returned to the supplier while return inwards 
means the goods returned by the customer. 
Q.8. What do you understand by Ledger folio ? 
Ans.Ledger folio is the small column of the journal where we write the page number of ledger on 
which the relevant account appears. Ledger folio helps in locating the concerned account. It ensures 
that entry has-been posted in the ledger. 
Q.9. Write the process of preparing ledger from a journal. 
Ans. The process of preparing ledger from a journal may be explained ns under: 
(1)Name of the account is written at the top. 
(2)All transactions relating to the account are recorded at one place. 
(3)If the account in which posting is being made. has been debited in the journal. posting is made on 
the debit side. If the account          has been credited in the journal. posting is made on the credit side. 
(4)The debit side of the journal entry is recorded to the debit side of the account by writ ing the item 
of the credit side of the                journal entry. Such an account is preceded by the word "To". The 
credit side of the journal 
Q.11. What do you understand by the Imprest amount in petty Cash Book ? 
Ans. It is convenient to entrust a definite sum of money to the petty cashier in the beginning of a 
period and to reimburse him for payments made at the end of the period. Thus. petty cashier will 
have again the fixed amount in the beginning of the new period. Such a system is known as the 
imprest system of petty cash und such amount is known ns imprest amount 
 
 
 
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