Question
Distinguish between Cash Book and Cash A/c.
✓
Answer
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Cash A/c
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Cash Book
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1.
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It is an account in tha Ledger.
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1.
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It is a separate book maintained for recording Cash transactions.
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2.
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Cash account is opened in tha ledger and posting is done in this account from journal.
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2.
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It is a book of original entry because all cash transactions are first of all recorded in Cash book and then posted from Cash book to various accounts in tha ledger.
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3.
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When transactions of Cash are recorded in journal, it is necessary to open a Cash A/c in ledger.
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3.
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When transaction of Cash are recorded in Cash book, there is no necessity to open a Cash A/c in tha ledger.
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4.
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It only records one aspect of a transaction i.e.,Cash.
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4.
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It fecords both tha aspects of a teansaction.
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Similar questions
How is a Bank Reconciliation Statement prepared?
Mr. Gopal started business for buying and selling of readymade garments with ₹ 8,00,000 as an initial investment. Out of this he paid ₹ 4,00,000 for the purchase of garments and ₹ 50,000 for furniture and ₹ 50,000 for computers and the remaining amount was deposited into the bank. He sold some of the ladies and kids garments for ₹ 3,00,000 for cash and some garments for ₹ 1,50,000 on credit to Mr. Rajesh.
Subsequently, he bought men's garments of ₹ 2,00,000 from Mr. Satish. In the first week of the next month, a fire broke out in his office and stock of garments worth ₹ 1,00,000 was destroyed. Later on, some garments which cost ₹ 1,20,000 were sold for ₹ 1,30,000. Expenses paid during the same period were ₹ 15,000. Mr. Gopal withdrew ₹ 20,000 from business for his domestic use.
From the above, answer the following:
Subsequently, he bought men's garments of ₹ 2,00,000 from Mr. Satish. In the first week of the next month, a fire broke out in his office and stock of garments worth ₹ 1,00,000 was destroyed. Later on, some garments which cost ₹ 1,20,000 were sold for ₹ 1,30,000. Expenses paid during the same period were ₹ 15,000. Mr. Gopal withdrew ₹ 20,000 from business for his domestic use.
From the above, answer the following:
- What is the amount of capital with which Mr. Gopal started the business?
- What fixed assets did he buy?
- What is the value of the goods purchased?
- Who is the creditor and state the amount payable to him?
- Who is the debtor and what is the amount receivable from him?
- What is the total amount of expenses?
- What is the amount of drawings of Mr. Gopal?
Journalise the following transactions:
- Goods destroyed by Fire for ₹ 5,000.
- Paid by cheque ₹ 25,000 as wages on installation of a Machinery.
- Issued a cheque in favour of M/s Parmatma Saran & Sons on account of purchase of goods ₹ 75,000.
- Goods sold costing ₹ 60,000 to M/s Kalu Sons at an invoice price 10% above cost less 5% Trade discount.
Y started a business on $1^{\text {st }}$ April, $2013 $with a Capital of $₹ 2,00,000$ and a loan of $₹ 75,000$ from the bank. During the year, he had introduced additional capital of ₹ $60,000 $and had withdrawn ₹ $36,000 $for personal purposes. On $31^{\text {st }}$ March, $2014 $his assets were ₹ $3,80,000$. Find out his Capital as on $31^{\text {st }}$ March, $2014$ and profit earned during the year $2013-14$.
→Explain any two Source Documents.
Prepare Accounting Equation from the following:
- Started business with Cash ₹ 2,00,000.
- Purchased goods for Cash ₹ 60,000 and on Credit ₹ 1,50,000.
- Sold goods for Cash costing ₹ 40,000 at a profit of 20% and on Credit costing ₹ 72,000 at a profit of 25%.
- Paid for Rent ₹ 5,000.
Record the following transactions in a bank column cash book for December 2016:
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₹
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01
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Started business with cash
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80,000
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04
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Deposited in bank
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50,000
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10
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Received cash from Rahul
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1,000
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15
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Bought goods for cash
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8,000
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22
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Bought goods by cheque
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10,000
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25
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Paid to Shyam by cash
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20,000
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30
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Drew from Bank for office use
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2,000
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31
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Rent paid by cheque
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1,000
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Prepare Returns Inward and Return Outward Books of Manoj, Mumbai from the following transactions and post them into Ledger Accounts:
Give two examples of errors of commission?
Prepare a Trial Balance with the following information:
Note: For Delhi 2011, figures given above have been reduced to half, hence the total of the Trial Balance will be ₹ 3,75,000, in that situation.
Note: For Delhi 2011, figures given above have been reduced to half, hence the total of the Trial Balance will be ₹ 3,75,000, in that situation.