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THE CASH BOOK IS A BOOK OF ORIGINAL ENTRY IN WHICH CASH RECEIPT AND PAYMENT ARE RECORDED.
THE RIGHT HAND OF THE CASH BOOK IS THE GIVING SIDE CALLED THE CREDIT SIDE WHILE THE LEFT HAND SIDE OF THE CASH BOOK IS THE RECEIVING SIDE CALLED THE DEBIT SIDE
SINGLE COLUMN CASH BOOKTWO COLUMN CASH BOOKTHREE COLUMN CASH BOOK PETTY CASH BOOK
SINGLE COLUMN CASH BOOK IS A BOOK USED TO RECORD CASH TRANSACTION ONLY
TWO COLUMN CASH BOOK IS A BOOK USED TO RECORD BOTH CASH AND CHEQUE [BANK] TRANSACTIONS.
DATE PARTICULAR FOLIO AMOUNT DATE PARTICULAR
FOLIO AMOUNT
DATE PARTICULAR
FOLIO CASH BANK DATE PARTICULAR
FOLIO CASH
BANK
THREE COLUMN CASH BOOK IS AN EXTENSION OF TWO COLUMN CASH BOOK WHICH COMPRISES THREE ACCOUNTS NAMELY CASH, BANK AND DISCOUNT.
FORMAT OF THREE COLUMN CASH BOOK
DATE
PARTICULAR
FOLIO
CASH
BANK
Discount Allowed
DATE
PARTICULAR
FOLIO
CASH
BANK
Discount Received
CONTRA ENTRY IS REFERRED TO ANY TRANSACTION THAT AFFECTS BOTH BANK AND CASH ACCOUNT AT THE SAME TIME E.G
WITHDREW CASH FROM THE BANK FOR OFFICE USE
PAID CASH INTO BANK BANKED CASH
DISCOUNT IS AN ALLOWANCE OR REBATE GIVEN TO CUSTOMER FOR EITHER PROMPT PAYMENT OR BULK PURCHASES. DISCOUNT IS DIVIDED INTO TWO
CASH DISCOUNT – FOR PROMPT PAYMENT
TRADE DISCOUNT- FOR BULK PURCHASES
DEBIT BOTH CASH AND CHEQUE RECEIPT
CREDIT BOTH CASH AND CHEQUE PAYMENTS
DEBIT SALES
CREDIT PURCHASES DEBIT ANY INCOME OR COMMISSION RECEIVED
CREDIT ANY EXPENSE
ENTER THE FOLLOWING INTO TWO COLUMN CASH BOOK OF OLA LIMITED
1/1/12 STARTED BUSINESS WITH CASH #2000 2/1/12 PAID WAGES IN CASH 100 5/1/12 RECEIVED#1000 CHEQUE FROM SOLA 20/1/12 CASH SALES PAID DIRECTLY INTO
BANK 200 31/1/12 PAID ELECTRICITY BY CHEQUE 500
DATE PARTICULAR
FOLIO
CASH BANK DATE PARTICULAR
FOLIO
CASH BANK
1/1/12
CAPITAL
2000 2/1/12
WAGES 100
5/1/12
SOLA 1000 30/1/12
ELECTRICITY
500
20/1/12
SALES 200
BAL C/D
1900 700
2000 1200 2000 1200
1/2/12
BAL B/D
1900 700
1. Discount allowed would appear on the (a) debit side of the cash book (b) credit side of the cash book (c) credit side of trading account (d) debit side of the trading account
2. The bank column in the cash book shows a credit balance of £180. This means (a) a total payment of £180 (b) overdraft of £180 (c) gross profit of £180 (d) leftover of £180 in the bank
3. A trader set aside from his private fund £1500 for the business purposes. The £1500 is (a) loan (b) capital (c) reserve (d) drawing
4. ___________ is allowance off invoice (a) trade discount (b) cash discount (c) sales day book (d) discount allowed
5. Which of the following account is not a prime book (a) cash book (b) purchases day book (c) purchases ledger (d)sales day book
Bal b/f xx Purchases 1400Sales 1000 Rent 600Sola 500 Salaries 1000 Bose 500 bal c/d xx
4000 4000
Bal b/d xx 6. The balance brought forward is (a) 2000 (b) 3000 (c) 4000 (d) 50007. The balance carried down is (a) 700 (b)800 (c) 1000 (d) 12008. The balance brought forward at the beginning of new accounting period is (a)
1000 (b) 1100 (c) 1200 (d) 13009. A transaction that affects both the cash and the bank account is called (a)
double entry (b) contra entry (c) single entry (d) bank entry
10. Drawing appears on the (a) debit side of the cash book (b) credit side of the cash book (c) credit side of trading account (d) debit side of the trading account
11. A three column cash book contains columns for (a) cash assets and liabilities (b) bank, cash and asset (c) cash, bank and returns (d) discount, cash and bank
1. State the principle of double entry2. State five subsidiary books 3. Defines cash book
1. Write up the column cash book from the following Nov. 1 balance b/f £ Cash 1,050 Bank 21,640 Nov. 2 cash sales 6,050 Nov.3 took out of the cash till and paid it into the bank Nov.4 Ola paid us cheque 2000 Discount
170 Nov.5 paid cash for stamps 600 Nov.6 received rates refund by cheque 720
• Nov.8 bought goods for cash 900• Nov.12 paid wages in cash 230• Nov 14 paid motor expenses by cheque 570• Nov.17we paid shola by cheque 700• Discount 40• Nov.19 cash drawing 300• Nov.20 cash sales 20• Nov.22 cash purchases 30• Nov. 23 received loan OLATUNJI by cheque 800• Nov. 25 banked cash 80• Nov.30 paid segun by cheque 100• Discount 80
Submit the answer (s) to tutorial questions on the day of resumption in hard copy
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