cash book - principles of accounting

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Accounting Quick Cash Balance Sheet Cash Converters

Cash Book

What is cash book?Cash book is For recording the receipts and payments of cash and cheques only.

It is considered as both a journal and a ledger.

Cash Discount and Trade Discount:

(A) Cash Discount: The term cash discount refers to the reduction or allowance given for quick

payment in cash or by cheque. The cash discount can be discount allowed or discount received.

(i) Discount allowed: A reduction given to customers (debtors) who pay their accounts within the time

limit. Discount allowed is an expense for the business.

(ii) Discount received: A reduction given to us by the suppliers (creditors) when we pay their accountsbefore the time allowed has elapsed. Discount received is an income for the business.

(B) Trade Discount: Trade discount is the reduction allowed from the list price (selling price) of thegoods. Trade discount is not recorded in the accounts but cash discounts are recorded in the accounts.

(1) Two-Column Cash book: The cash book for recording cash and cheque transactions together isknown as the two-column cash book

. Contra Entry: A contra entry for cash book items is where both the debit and credit are shownin the cash book itself.

Format of the Two Column Cash Book

Assignment Questions:

1. A cash book shows a debit balance $ 50. What does this mean?

A. There is cash in hand $ 50 B. Cash has been over spent by $ 50

C. Total cash paid out $ 50 D. Total cash received is less than $ 50

2. We bought goods on credit from Charles. He was paid within prescribed time and he gave a reductionfor that. What does this reduction mean for us?

A. Discount allowed B. Discount received

C. Discount given D. Special discount

3. Which of the books does consist a cash account and a bank account put together in to one book?

A. Cash book B. Bank book C. Sales book D. Pass book

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Page 1 of 13Cash Book - Principles Of Accounting

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4. A trader maintains the two column cash book.

Debit balance of bank column $ 1,000

Cheques deposited $ 200

Cheques drawn for cash $ 350

What is the balance of the bank column at the end?

A. $ 1,150 B. $ 1,000 C. $ 850 D. $ 1,550

5. What does the discount column of the cash book record?

A. Discounts for trade customers B. Discounts for prompt payment

C. Discount for bulk buying D. Discount for suppliers

6. A cash book shows a debit balance $ 50. What does this mean?







A. Cash book B. Bank book

C. Sales book D. Pass book




Cheques drawn for cash $ 350

What is the balance of the bank column at the end?

A. $ 1,150 B. $ 1,000 C. $ 850 D. $ 1,550




LONG QUESTIONS:

Q.1. Prepare a Two Column Cash Book for the month of December 2005 from the following transactions.

2005

Dec 1 Proprietor puts Capital into a bank account for the business $ 9,400

Dec 2 Received cheque from Boon $ 1,100

Dec 4 Cash Sales $ 1,200

Dec 6 Paid rent by cash $ 450

Dec 7 Deposited Cash into Bank $ 500

Dec 15 Cash Sales paid directly into the Bank $ 400

Dec 23 Paid cheque to S,wills $ 2,700

Dec 29 Withdrew cash from bank for business use $ 1,200

Dec 30 Paid wages in cash $ 1,100

Q.2. Prepare a Two column cash book for the month of January 2006 from the following transactions.

2006

Jan 1 Started business with Cash $ 10,000 and of Bank $ 15,000

Jan 3 Bought goods by cheque $ 3,000


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Jan 5 Sold goods for cash $ 5,000

Jan 6 Paid Wages in cash $ 700

Jan 10 Paid for postage and stationery $ 300 in cash

Jan 13 Bought goods from Jack for $ 3,000

Jan 15 Bought goods for Cash $ 5,000

Jan 18 Sold goods and received by cheque $ 7,000

Jan 20 Sold goods to Jim for $ 2,000

Jan 24 Paid Telephone charges by cheque $ 1,000

Jan 26 Cash deposited into bank $ 5,000

Jan 27 Withdrew from Bank $ 1,000 for personal use

Jan 29 Cash sales $ 1,500

Jan 30 Withdrew cash from Bank business use $ 1,500

Q. 3 Write up a Two column cash book from the following for the month

of November 2002.

2002 Nov.

1 Balances brought down from the last month:

Cash $1,050 (Dr)Bank $2,100 (Cr)

3 Cash sales $ 600

4 Took $1,200 from the cash till and deposited in the bank

5 T. Terry paid us by cheque $270

6 Bought postage stamps in cash $160

7 Bought office furniture for cheque $180

8 We paid L.Lucas by cheque $500

9 Received cheque for sale of goods $ 2,000

11 Withdrew $ 750 from the bank for business use.

14 Paid wages in cash $ 230

16 Paid motor expenses by cheque $100

20 R. Numan paid us by cheque $920

24 Paid general expenses by cash $ 72

28 Paid insurance by cheque $54

29 Paid rent in cash $ 400

30 The owner took cash from the business by for his private use $ 100

Q. 4 Prepare a two-column cash book for the month of January 2001 from the following

transactions:

2001

January

1 Balances brought down: Cash $ 4,200; Bank $1,200

2 Bought goods for cash $1,000

3 Bought furniture for cheque $1,200

4 Received cheque from Sameen $5,100

5 Received cash from Sannal $2,500

8 Cash sales $3,500

9 Cash purchases $2,800

12 Paid cash for stationery $180

14 Bought goods for cheque $1,400

18 Received commission in cash $250

21 Settled the account of Martin by cheque $1,800

23 Rita settled her account of $1,000 by cheque.

25 Paid insurance in cash $ 250

28 Paid cash for office expenses $150

30 Paid wages to the workers $700 in cash


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31 Cash sales for the week $ 2,500

31 Withdrew cash from the business bank account for business use $1,700

Q. 5 From the following transactions, prepare the two column cash book for the month ofMarch 2003:-

2003 March

1 Balances b/d: Cash $ 1800 (Dr.) Bank $ 2100 (Dr)

2 Received cheque from Samoon $ 21003 Cash sales for the week $5200

4 Cash purchases $ 2200

5 Carriage inwards paid in cash $200

6 Rafi paid us cash $2000 for the settlement of his account

8 We paid Sonu $3000 by cheque for the settlement of his account

10 Deposited cash into the bank account $2000

12 Paid advertising expenses in cash $500

14 Paid cash for carriage outwards $150

18 Bought stationery by cheque $600

20 Bought goods by cheque $ 800

24 Received commission by cheque$1400

26 Paid rent of business building by cheque $1500

28 Paid salaries by cheque $ 2000

30 Withdrew cash from the business bank A/C for office use $3100

31 Cheque received for the sale of goods $3100

(2)The Three-Column Cash Book: The cash book for recording cash, bank (cheque) and discount

transactions together. From this book cash balance, (balance of cash in hand), bank balance (balance of

cash at bank or overdraft) total discount allowed and total discount received etc. can be found.

Usually the discount columns are not balanced. But, the discount columns

are totalled. The total of debit side discount column is considered as total discount allowed and the

total of credit side discount column is considered as total discount received.

Both the two-column cash bookand the three-column cash book serve asjournals and Ledgers


Select the correct answer:

Q. 1 A cash discount will be entered in the

(a) two column cash book (b) three column cash book

(c) petty cash book (d) none of the above.

Q. 2 A trade discount will appear in the

(a) two column cash book (b) three column cash book



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Q. 3 A trade discount will

(a) increase the selling price (b) decrease the selling price

(c) increase the purchase price (d) none of the above.

Q. 4 Contra entries should affect

(a) both cash and bank columns on both sides.

(b) both cash and Bank columns on the debit side.

(c) both cash and bank columns on the credit side.

(d) none of the above.

Q. 5 A discount received will appear on the

(a) debit side of the Two-column cashbook

(b) credit side of the Two-column cashbook

(c) debit side of the Three-column cashbook

(d) credit side of the Three-column cashbook

Q. 6 A cash discount is allowed at the time of of cash or cheque.

(a) Sales (b) Purchase (c) Receipt (d) Payments.

Q. 7 The left hand side of the three-column cashbook is called

(a) payment side (b) receipts side (c) credit side (d) none of these

Q. 8 The right hand side of the cash book is called

(a) receipts side (b) payment side (c) income side (d) none of these

Q. 9 The cash book is used for recording

(a) all cash receipts only

(b) all cash payments & receipts only

(c) all cash & cheques receipts only

(d) all cash & cheques receipts and payments only.

Q. 10 A trade discount is:-`

(a) recorded in the books (b) not recorded in the books of the business

(c) not deducted from the value of the goods (d) none of these

Q. 11 Which of the following statements is correct?

A cash discount is

(a) given to encourage people to settle their accounts within a stated time limit

(b) the name given to a discount to increase the number of customers.

(c) the name given to a discount for cash purchases

(d) given for cash or credit purchases.

Q. 12 Fill in the following with the most suitable terms

1) An asset sold for cash is recorded in the book

2) In a three column cash book, the discount columns are

3) The total of the discount column in the debit side of a three column cash book is

4) The total of the discount column in the credit side of a three column cash book is

5) The cash book is both a and a

6) The cash account shows balance only.

7) The bank account may show or balance.

8) A cash discount is a reduction allowed to encourage

payment of cash.

9) A trade discount is the reduction from the of goods


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10) All receipts and payments of cheques and cash are recorded in

11) The book for recording the receipts & payments of cash & cheques is known

as -

Q.13 From the following transactions your are required to prepare a Three column cash

book for the month of February 2006

2006

Feb 1 Cash balance (Dr) $ 20,000 and Bank balance (Dr) $ 50,000

Feb 2 Bought goods and paid by cheque $ 10,000

Feb 4 Cash sales $ 5,000

Feb 5 Bought goods from James $ 10,000

Feb 6 Sold goods to Raheem $ 7,000

Feb 7 Paid Wages by cash $ 500

Feb 10 Paid Electricity charges by cheque $ 1,000

Feb 15 Received cheque for $ 6,600 from Raheem in full settlement of his account

Feb 20 Paid James by cash for $ 9,500 in full settlement of his account.

Feb 23 Paid salaries by cheque $ 5,000

Feb 25 Received commission in cash $ 2,000

Feb 28 Cash paid into Bank $ 3,000

Q. 14 From the following you are required to prepare a three column cash book

for the month of March 2003

2003 March

1 Balances brought down: Cash $21,00 (Dr).; Bank $1,200 (Cr.)

2 Cash sales $2,700

3 Cash purchases $ 800

4 Settled the account of Mathews $ 1,800 by cheque

7 Sold an old fixture for cash $1,900


9 Reema settled her account of $2,400 by cheque after deducting

cash discount $100

10 Received rent of building $1,000 in cash.

12 Sold goods and received cheque $3,000

13 Issued a cheque to Mannya $1,800 for the full settlement of

her a/c of $1,900

15 Received a cheque from Sunitha $2,100 for the full settlement of

her a/c of $2,150

17 Cash purchases for the week $1,500

18 Paid travelling expenses in cash $150

20 Bought machinery for cheque $ 4,500

21 Paid cheque to Sumon $2,750 after deducting cash discount $ 150

24 Sold goods and received cheque $800

25 Received commission in cash $1,000

28 Paid electricity charges by cheque $500

29 Paid salaries for the month $2,000 in cash


31 Deposited cash in the bank account $2,500

Q. 15 Prepare a three column cash book from the following for the month of January 2003

2003 January

1 Balances brought down: Cash $ 2,300 (Dr.); Bank $ 5,200 (Dr.)


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7/13

2 The following paid their accounts by cheque, in each case deducting 5% cash discount: B. Binnu $

4,000 C. Climate $3,000

3 Paid rent by cheque $1,000

4 J. Jackson lent us $1,400 by cheque

6 We paid the following accounts by cheque in each case deducting cash discount 5%:- N.North$ 900; S.South $1,400

8 Paid Motor expenses in cash $ 250

12 W. West paid his account of $180 by cheque $170, deducting $ 10 cash discount.

14 Paid wages in cash $270

16 The following paid their accounts by cheque, in each case deducting 10% cash discount: C.Cinu$1,200; D.David $3,000 ; E. Ellis $ 2,000

18 Cash drawings from the business $280

19 Cash withdrawn from the bank for the business use $1,500

21 Cash sales for the week $1,500

24 Paid to P. Potter his account of $800 in cash $ 750 after deducting $50 as cash discount.


28 Received rent by cheque $180

29 Cash sales $1,650

30 Paid salaries $3,000 by cheque

31 Paid rent $1,000 in cash and insurance $500 by cheque.

Q. 16 From the following information taken from the books of Peter Shewag, prepare a

three column cash book for the month of March 2001 and balance the cash book

on that date:

01 March Balances brought forward from the previous month:

Cash $23,000; Bank $11,000

02 March Received cash from the following in each case after deducting 10%

cash discount: Ameen $6,000; Ahmed $5,000

05 March Received commission by cheque from Aishath $7,100

07 March Issued cheques to the following in each case after deducting 5% cash

discount: Afzal $4,600; Shifana $6,400

09 March Paid cash to Faruhana $1,000

11 March Paid Power charges by cheque $200

15 March Bought one machinery for cash $3,000

17 March Received a cheque from Smith for $6,900 after deducting $2,100 as

cash discount.

21 March Rent received by cheque $2,000

22 March Cash withdrawn from the bank $500 for the business use.

24 March Bought goods by cash $2,700

27 March Sold an old motor car for $3,000. Payment received in cash immediately.

28 March Paid wages in cash $250

29 March Telephone charges paid by cheque $300

30 March Cash deposited in the bank $2,500

31 March Issued a cheque to Babu for $9,000 after deducting $1,000.

Q.17 From the following, prepare the three column cash book for the month of January 2003:

1 Balances B/d : Bank $ 5200 ; Cash $ 2800

4 Withdrew cash from bank account $ 3000

7 Bought goods by cash $ 1800

8 Sold goods and received cheque $ 2500

9 Paid cash for stationery $ 100

10 Paid carriage inwards by cheque $ 500


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8/13

11 Sold goods and received cash $ 5400

11 The following paid us in cash having deducted cash discount 10% in each case Ameer $1400:

C.Chand $ 2500

12 Wages paid in cash $ 1300

15 Cash sales deposited in the bank account $ 1800

16 Paid cheque to Babu $ 600 after deducting cash discount $ 30

18 Sajan paid his account of $ 1800 by cheque in full settlement for $1750

20 Samson paid into our bank account $ 100024 Paid salaries for the month by cheque $ 1600

26 Paid cheque to Anil $ 1300 in full settlement of his account of $ 1350

28 Paid cleaning charges $ 150 in cash.

30 Received commission in cash $ 1000

31 Cash sales for the week $ 3500

Q. 18 Prepare a three column cash book from the following transactions for the month

of March 2003:

2003 March

1 Balances b/d: Cash $ 2400(Dr) ; Bank $ 400 (Cr)

2 Paid cash to the petty cashier $168

2 Received cash from Samson $1800 for the settlement of his account of $1800

4 Cash sales deposited into bank $ 3800

6 Settled the account of Mark $2500, by cheque $ 2440

8 Bought goods by cheque $ 1000

9 Sold furniture by cash $ 500

11 Received commission by in cash$ 900

13 Paid stationery by cash $160

16 Reema settled her account of $ 1700 by cash $ 1650 after deducting cash

discount.

18 Meenu settled her account by cheque $ 2500 after deducting cash discount

21 Bought Machinery by cheque $ 4000

23 Cash sales for the week $1800

24 Settled the account of Adil by cheque $1250 after deducting

cash discount $30

26 Reetha deposited cash directly in our bank account $ 700

29 Bank charges paid from the bank account $15

31 Cash sales deposited into bank account $ 2000

For recording the receipts and payments of cash and cheques only.

It is considered as both a journal and a ledger.

Cash Discount and Trade Discount:(A) Cash Discount: The term cash discount refers to the reduction or allowance given for quick payment

in cash or by cheque. The cash discount can be discount allowed or discount received.(i) Discount allowed: A reduction given to customers (debtors) who pay their accounts within the time

limit. Discount allowed is an expense for the business.

(ii) Discount received: A reduction given to us by the suppliers (creditors) when we pay their accountsbefore the time allowed has elapsed. Discount received is an income for the business.

(B) Trade Discount: Trade discount is the reduction allowed from the list price (selling price) of the

goods. Trade discount is not recorded in the accounts but cash discounts are recorded in the accounts.

(1) Two-Column Cash book: The cash book for recording cash and cheque transactions together isknown as the two-column cash book

. Contra Entry: A contra entry for cash book items is where both the debit and credit are shown in thecash book itself.

Format of the Two Column Cash Book

Two Column Cash Book for the month of December 2002

Date Details LF Cash

$ Bank


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9/13

$ Date Details LF Cash

$ Bank$

(All receipts of cash and cheques) (All payments of cash and cheques)

Assignment Questions:1. A cash book shows a debit balance $ 50. What does this mean?



2. We bought goods on credit from Charles. He was paid within prescribed time and he gave a reduction

for that. What does this reduction mean for us?A. Discount allowed B. Discount receivedC. Discount given D. Special discount

3. Which of the books does consist a cash account and a bank account put together in to one book?A. Cash book B. Bank book C. Sales book D. Pass book

4. A trader maintains the two column cash book.Debit balance of bank column $ 1,000


Cheques drawn for cash $ 350What is the balance of the bank column at the end?

A. $ 1,150 B. $ 1,000 C. $ 850 D. $ 1,550


A. Discounts for trade customers B. Discounts for prompt paymentC. Discount for bulk buying D. Discount for suppliers

6. A cash book shows a debit balance $ 50. What does this mean?A. There is cash in hand $ 50 B. Cash has been over spent by $ 50C. Total cash paid out $ 5 D. Total cash received is less than $ 50





A. Cash book B. Bank bookC. Sales book D. Pass book



Cheques deposited $ 200Cheques drawn for cash $ 350

What is the balance of the bank column at the end?A. $ 1,150 B. $ 1,000 C. $ 850 D. $ 1,550




LONG QUESTIONS:Q.1. Prepare a Two Column Cash Book for the month of December 2005 from the following transactions.2005Dec 1 Proprietor puts Capital into a bank account for the business $ 9,400

Dec 2 Received cheque from Boon $ 1,100Dec 4 Cash Sales $ 1,200Dec 6 Paid rent by cash $ 450

Dec 7 Deposited Cash into Bank $ 500Dec 15 Cash Sales paid directly into the Bank $ 400Dec 23 Paid cheque to S,wills $ 2,700

Dec 29 Withdrew cash from bank for business use $ 1,200

Dec 30 Paid wages in cash $ 1,100

Q.2. Prepare a Two column cash book for the month of January 2006 from the following transactions.

2006Jan 1 Started business with Cash $ 10,000 and of Bank $ 15,000

Jan 3 Bought goods by cheque $ 3,000

Jan 5 Sold goods for cash $ 5,000Jan 6 Paid Wages in cash $ 700Jan 10 Paid for postage and stationery $ 300 in cash

Jan 13 Bought goods from Jack for $ 3,000Jan 15 Bought goods for Cash $ 5,000Jan 18 Sold goods and received by cheque $ 7,000

Jan 20 Sold goods to Jim for $ 2,000

Jan 24 Paid Telephone charges by cheque $ 1,000Jan 26 Cash deposited into bank $ 5,000

Jan 27 Withdrew from Bank $ 1,000 for personal use

Jan 29 Cash sales $ 1,500Jan 30 Withdrew cash from Bank business use $ 1,500

Q. 3 Write up a Two column cash book from the following for the monthof November 2002.

2002 Nov.

1 Balances brought down from the last month:Cash $1,050 (Dr)Bank $2,100 (Cr)

3 Cash sales $ 600


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10/13

4 Took $1,200 from the cash till and deposited in the bank

5 T. Terry paid us by cheque $2706 Bought postage stamps in cash $160

7 Bought office furniture for cheque $180

8 We paid L.Lucas by cheque $5009 Received cheque for sale of goods $ 2,000

11 Withdrew $ 750 from the bank for business use.

14 Paid wages in cash $ 23016 Paid motor expenses by cheque $10020 R. Numan paid us by cheque $920

24 Paid general expenses by cash $ 72

28 Paid insurance by cheque $5429 Paid rent in cash $ 400

30 The owner took cash from the business by for his private use $ 100

Q. 4 Prepare a two-column cash book for the month of January 2001 from the following transactions:2001

January

1 Balances brought down: Cash $ 4,200; Bank $1,2002 Bought goods for cash $1,000

3 Bought furniture for cheque $1,2004 Received cheque from Sameen $5,100

5 Received cash from Sannal $2,500

8 Cash sales $3,5009 Cash purchases $2,800

12 Paid cash for stationery $180

14 Bought goods for cheque $1,40018 Received commission in cash $25021 Settled the account of Martin by cheque $1,800

23 Rita settled her account of $1,000 by cheque.25 Paid insurance in cash $ 25028 Paid cash for office expenses $150

30 Paid wages to the workers $700 in cash31 Cash sales for the week $ 2,50031 Withdrew cash from the business bank account for business use $1,700

Q. 5 From the following transactions, prepare the two column cash book for the month of March2003:-

2003 March

1 Balances b/d: Cash $ 1800 (Dr.) Bank $ 2100 (Dr)2 Received cheque from Samoon $ 2100

3 Cash sales for the week $5200

4 Cash purchases $ 22005 Carriage inwards paid in cash $2006 Rafi paid us cash $2000 for the settlement of his account

8 We paid Sonu $3000 by cheque for the settlement of his account10 Deposited cash into the bank account $200012 Paid advertising expenses in cash $500

14 Paid cash for carriage outwards $150

18 Bought stationery by cheque $60020 Bought goods by cheque $ 800

24 Received commission by cheque$140026 Paid rent of business building by cheque $150028 Paid salaries by cheque $ 2000

30 Withdrew cash from the business bank A/C for office use $310031 Cheque received for the sale of goods $3100

(2)The Three-Column Cash Book: The cash book for recording cash, bank (cheque) and discounttransactions together. From this book cash balance, (balance of cash in hand), bank balance (balance of

cash at bank or overdraft) total discount allowed and total discount received etc. can be found.

Usually the discount columns are not balanced. But, the discount columnsare totalled. The total of debit side discount column is considered as total discount allowed and the

total of credit side discount column is considered as total discount received.

Both the two-column cash book and the three-column cash book serve as journals and Ledgers

Format of the Three-Column Cash BookThree Column Cash Book for the month of January 2002

Date Details LF Dis. Allow Cash

$ Bank$ Date Details LF Dis.

Recd Cash$ Bank

$

(All receipts of cash and cheques) (All payments of cash and cheques)


Select the correct answer:Q. 1 A cash discount will be entered in the

(a) two column cash book (b) three column cash book(c) petty cash book (d) none of the above.

Q. 2 A trade discount will appear in the(a) two column cash book (b) three column cash book


Q. 3 A trade discount will(a) increase the selling price (b) decrease the selling price


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(c) increase the purchase price (d) none of the above.

Q. 4 Contra entries should affect

(a) both cash and bank columns on both sides.

(b) both cash and Bank columns on the debit side.(c) both cash and bank columns on the credit side.

(d) none of the above.

Q. 5 A discount received will appear on the

(a) debit side of the Two-column cashbook(b) credit side of the Two-column cashbook

(c) debit side of the Three-column cashbook

(d) credit side of the Three-column cashbookQ. 6 A cash discount is allowed at the time of of cash or cheque.

(a) Sales (b) Purchase (c) Receipt (d) Payments.

Q. 7 The left hand side of the three-column cashbook is called(a) payment side (b) receipts side (c) credit side (d) none of these

Q. 8 The right hand side of the cash book is called(a) receipts side (b) payment side (c) income side (d) none of these

Q. 9 The cash book is used for recording(a) all cash receipts only

(b) all cash payments & receipts only

(c) all cash & cheques receipts only(d) all cash & cheques receipts and payments only.

Q. 10 A trade discount is:-`

(a) recorded in the books (b) not recorded in the books of the business(c) not deducted from the value of the goods (d) none of these

Q. 11 Which of the following statements is correct?

A cash discount is(a) given to encourage people to settle their accounts within a stated time limit(b) the name given to a discount to increase the number of customers.

(c) the name given to a discount for cash purchases

(d) given for cash or credit purchases.

Q. 12 Fill in the following with the most suitable terms

1) An asset sold for cash is recorded in the book2) In a three column cash book, the discount columns are

3) The total of the discount column in the debit side of a three column cash book is

4) The total of the discount column in the credit side of a three column cash book is 5) The cash book is both a and a

6) The cash account shows balance only.

7) The bank account may show or balance.8) A cash discount is a reduction allowed to encourage

payment of cash.

9) A trade discount is the reduction from the of goods10) All receipts and payments of cheques and cash are recorded in

11) The book for recording the receipts & payments of cash & cheques is known

as -

Q.13 From the following transactions your are required to prepare a Three column cash

book for the month of February 20062006Feb 1 Cash balance (Dr) $ 20,000 and Bank balance (Dr) $ 50,000

Feb 2 Bought goods and paid by cheque $ 10,000Feb 4 Cash sales $ 5,000Feb 5 Bought goods from James $ 10,000

Feb 6 Sold goods to Raheem $ 7,000

Feb 7 Paid Wages by cash $ 500Feb 10 Paid Electricity charges by cheque $ 1,000

Feb 15 Received cheque for $ 6,600 from Raheem in full settlement of his account

Feb 20 Paid James by cash for $ 9,500 in full settlement of his account.Feb 23 Paid salaries by cheque $ 5,000

Feb 25 Received commission in cash $ 2,000

Feb 28 Cash paid into Bank $ 3,000

Q. 14 From the following you are required to prepare a three column cash book

for the month of March 2003

2003 March1 Balances brought down: Cash $21,00 (Dr).; Bank $1,200 (Cr.)

2 Cash sales $2,700

3 Cash purchases $ 8004 Settled the account of Mathews $ 1,800 by cheque

7 Sold an old fixture for cash $1,900

8 Bought furniture for cheque $1,4009 Reema settled her account of $2,400 by cheque after deducting

cash discount $10010 Received rent of building $1,000 in cash.


13 Issued a cheque to Mannya $1,800 for the full settlement ofher a/c of $1,900

15 Received a cheque from Sunitha $2,100 for the full settlement of

her a/c of $2,15017 Cash purchases for the week $1,500


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12/13

18 Paid travelling expenses in cash $150

20 Bought machinery for cheque $ 4,50021 Paid cheque to Sumon $2,750 after deducting cash discount $ 150

24 Sold goods and received cheque $800

25 Received commission in cash $1,00028 Paid electricity charges by cheque $500

29 Paid salaries for the month $2,000 in cash

30 Sold goods and received cheque $4,10031 Deposited cash in the bank account $2,500

Q. 15 Prepare a three column cash book from the following for the month of January 20032003 January1 Balances brought down: Cash $ 2,300 (Dr.); Bank $ 5,200 (Dr.)

2 The following paid their accounts by cheque, in each case deducting 5% cash discount: B. Binnu $

4,000 C. Climate $3,0003 Paid rent by cheque $1,000

4 J. Jackson lent us $1,400 by cheque

6 We paid the following accounts by cheque in each case deducting cash discount 5%:- N.North $900; S.South $1,400

8 Paid Motor expenses in cash $ 250

12 W. West paid his account of $180 by cheque $170, deducting $ 10 cash discount.14 Paid wages in cash $270

16 The following paid their accounts by cheque, in each case deducting 10% cash discount: C.Cinu$1,200; D.David $3,000 ; E. Ellis $ 2,000

18 Cash drawings from the business $280

19 Cash withdrawn from the bank for the business use $1,50021 Cash sales for the week $1,500

24 Paid to P. Potter his account of $800 in cash $ 750 after deducting $50 as cash discount.27 Bought furniture for cheque $1,500

28 Received rent by cheque $18029 Cash sales $1,650

30 Paid salaries $3,000 by cheque31 Paid rent $1,000 in cash and insurance $500 by cheque.

Q. 16 From the following information taken from the books of Peter Shewag, prepare a

three column cash book for the month of March 2001 and balance the cash bookon that date:

01 March Balances brought forward from the previous month:

Cash $23,000; Bank $11,00002 March Received cash from the following in each case after deducting 10%

cash discount: Ameen $6,000; Ahmed $5,000

05 March Received commission by cheque from Aishath $7,10007 March Issued cheques to the following in each case after deducting 5% cashdiscount: Afzal $4,600; Shifana $6,400

09 March Paid cash to Faruhana $1,00011 March Paid Power charges by cheque $20015 March Bought one machinery for cash $3,000

17 March Received a cheque from Smith for $6,900 after deducting $2,100 ascash discount.21 March Rent received by cheque $2,000

22 March Cash withdrawn from the bank $500 for the business use.24 March Bought goods by cash $2,70027 March Sold an old motor car for $3,000. Payment received in cash immediately.

28 March Paid wages in cash $250

29 March Telephone charges paid by cheque $30030 March Cash deposited in the bank $2,500

31 March Issued a cheque to Babu for $9,000 after deducting $1,000.

Q.17 From the following, prepare the three column cash book for the month of January 2003:1 Balances B/d : Bank $ 5200 ; Cash $ 2800

4 Withdrew cash from bank account $ 30007 Bought goods by cash $ 18008 Sold goods and received cheque $ 2500

9 Paid cash for stationery $ 100

10 Paid carriage inwards by cheque $ 50011 Sold goods and received cash $ 5400

11 The following paid us in cash having deducted cash discount 10% in each case Ameer $1400:

C.Chand $ 250012 Wages paid in cash $ 1300

15 Cash sales deposited in the bank account $ 1800

16 Paid cheque to Babu $ 600 after deducting cash discount $ 3018 Sajan paid his account of $ 1800 by cheque in full settlement for $1750

20 Samson paid into our bank account $ 100024 Paid salaries for the month by cheque $ 1600

26 Paid cheque to Anil $ 1300 in full settlement of his account of $ 1350

28 Paid cleaning charges $ 150 in cash.30 Received commission in cash $ 100031 Cash sales for the week $ 3500

Q. 18 Prepare a three column cash book from the following transactions for the month

of March 2003:

2003 March

1 Balances b/d: Cash $ 2400(Dr) ; Bank $ 400 (Cr)2 Paid cash to the petty cashier $1682 Received cash from Samson $1800 for the settlement of his account of $1800

4 Cash sales deposited into bank $ 3800


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13/13

6 Settled the account of Mark $2500, by cheque $ 2440

8 Bought goods by cheque $ 10009 Sold furniture by cash $ 500

11 Received commission by in cash$ 900

13 Paid stationery by cash $16016 Reema settled her account of $ 1700 by cash $ 1650 after deducting cash

discount.

18 Meenu settled her account by cheque $ 2500 after deducting cash discount21 Bought Machinery by cheque $ 400023 Cash sales for the week $1800

24 Settled the account of Adil by cheque $1250 after deducting

cash discount $3026 Reetha deposited cash directly in our bank account $ 700

29 Bank charges paid from the bank account $15

31 Cash sales deposited into bank account $ 2000

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