. Which of the following is recorded as contra entry? (a) Withdrew cash from bank for personal use (b) Withdrew cash from bank for office use (c) Direct payment by the customer in the bank account of the business (d) When bank charges interest . If the debit and credit aspects of a transaction are recorded in the cash book, it is (a) Contra entry (b) Compound entry (c) Single entry (d) Simple entry .
The balance in the petty cash book is (a) An expense (b) A profit (c) An asset (d) A liability . Petty cash may be used to pay (a) The expenses relating to postage and conveyance (b) Salary to the Manager (c) Purchase of furniture and fixtures (d) Purchase of raw materials Accountancy - . Small payments are recorded in a book called (a) Cash book (b) Purchase book (c) Bills payable book (d) Petty cash book Answer . (d) .
(d) II Very short answer questions . What is cash book? . What are the different types of cash book?
. What is simple cash book? . Give the format of ‘Single column cash book’.
. What is double column cash book? . Give the format of ‘Double column cash book’.
. What is three column cash book? . What is cash discount?
. What is trade discount? . What is a petty cash book?
III Short answer questions . Explain the meaning of imprest system of petty cash book. . Bring out the differences between cash discount and trade discount.
. Write the advantages of maintaining petty cash book. . Write a brief note on accounting treatment of discount in cash book.
. Brifly explain about contra entry with examples. IV Exercises Single Column Cash Book . Enter the following transactions in a single column cash book of Seshadri for May, .
May Cash in hand , Cash received from Swathi , Paid wages in cash ,