Cash Book

Debit side – Bank column ₹15,000; Credit side – Cash column ₹15,000; marked as Contra Entry

Step 1: When cash is deposited into the bank, two things happen simultaneously – Cash in hand decreases, and Cash at Bank increases. Step 2: Cash at Bank increasing means the Bank Account is debited → enter ₹15,000 in the Bank column on the DEBIT side ('To Cash'). Step 3: Cash in hand decreasing means the Cash Account is credited → enter ₹15,000 in the Cash column on the CREDIT side ('By Bank'). Step 4: Since both Cash Account and Bank Account exist within the same Cash Book, this is called a Contra Entry, marked with letter (C) in the L.F. column on both sides. Step 5: Option B is the reverse

₹5,000 credited to the Bank column for dishonoured cheque, and ₹50 separately credited to the Bank column for bank charges

Step 1: When a cheque deposited in the bank is dishonoured, the bank reverses the credit it had given. This means the bank balance decreases – so we record ₹5,000 on the CREDIT side of the Bank column (debiting the customer's account). Step 2: The name of the party (customer) is written in the particulars column of the credit side. Step 3: Bank charges of ₹50 are charged by the bank for processing the dishonour. This also reduces bank balance – so ₹50 is entered separately on the CREDIT side of the Bank column as 'By Bank Charges Account'. Step 4: These are two separate transactions and should

₹23,000 written on the credit side as 'By Balance c/d'

Step 1: To balance the Cash Book, compare the totals of both sides. Debit side total = ₹85,000; Credit side total = ₹62,000. Step 2: The difference = ₹85,000 – ₹62,000 = ₹23,000. This is the cash balance remaining (cash in hand). Step 3: Since the debit side is larger, cash receipts exceed payments, meaning there is a positive cash balance. Step 4: To make both sides equal, ₹23,000 is written on the CREDIT side as 'By Balance c/d' (Balance carried down). Step 5: This ₹23,000 then becomes the opening balance for the next period, written as 'To Balance b/d' on the DEBIT side. A cash balance is a

Goods sold on credit to a customer for ₹10,000

Step 1: The fundamental rule of the Cash Book is that ONLY cash transactions (involving actual receipt or payment of cash/cheque) are recorded. Step 2: Credit transactions do not involve immediate cash movement and are therefore NOT recorded in the Cash Book. Step 3: 'Goods sold on credit' means no cash is received now – the customer will pay later. So this goes into the Sales Book (or Journal), NOT the Cash Book. Step 4: Option A – Cash received from debtor is a cash receipt → recorded in Cash Book (only the cash amount, not the discount). Step 5: Option C – Cash withdrawn from bank is a cont