Tag: meaning and advantages of cash book

Questions Related to meaning and advantages of cash book

The total amount column of the sales return books is _________________.

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. Credited to purchases return account

  2. Debited to sales return account

  3. Credited to sales return account

  4. Debited to purchases returns account

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Correct Option: B

_______is the book in which all transactions concerning cash receipts and cash payments are recorded.

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. Journal proper

  2. Cash book

  3. Sales book

  4. none of above.

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Correct Option: B

Which of the following column of the cash book is never balanced ?

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. Cash column

  2. Bank column

  3. Discount column

  4. None of the above

Show answer
Correct Option: C
Explanation:

All cash receipts and discount allowed are recorded on the debit side and all cash payments and discount received are recorded on the credit side as same in single column cash book.

Discount column is not balanced. The total of discount columns is transferred to the Profit and Loss account.

Contra entry appears in ______________.

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. Purchases Returns book

  2. Cash book

  3. Journal proper

  4. All of the above

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Correct Option: B

The cash book records _______________.

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. All cash payments

  2. All cash receipts

  3. All cash receipts and payments

  4. Cash and credit sale of goods

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Correct Option: C

Admission fees received during the year should be treated ______________.

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. As capital income

  2. As revenue income

  3. As revenue, unless the amount involved is large

  4. As capital, except for large amounts involved

Show answer
Correct Option: C

Total of debit side discount column of cash book is posted to ______________.

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. Cr. of Discount Received A/c

  2. Dr. of Discount Received A/c

  3. Cr. of Discount Allowed A/c

  4. Dr. of Discount Allowed A/c

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Correct Option: D

Contra entries are passed only when __________________.

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. Simple cash book is prepared

  2. Three-column cash book is prepared

  3. Double-column cash book is prepared

  4. None of the above

Show answer
Correct Option: C
Explanation:

Contra entry is passes only when Double column cash book is prepared. 

The reason for making two entries is to comply with the principle of double entry.

Rent due for the month of March will appear ___________________.

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. On the payment side of the cash book

  2. On the receipt side of the cash book

  3. Nowhere in the cash book

  4. As a contra entry

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Correct Option: C

Which of the column of the cash book can have credit opening or closing balance ? 

elements of book keeping and accountancy recording and posting of cash transactions explain the purpose of maintaining a cash book introduction, meaning and importance of cash book meaning and advantages of cash book

  1. Cash column

  2. Bank column

  3. Discount column

  4. (B) & (C)

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Correct Option: B