Cash cannot be misappropriated by ____________.

Omitting to enter any cash which has been received

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Entering less amount than what has been actually received

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Making fictitious entries on the receipts side of cash book

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Making fictitious entries on the payments side of the cash book

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Solution

The correct option is D Making fictitious entries on the receipts side of cash book
Fictitious entries done in the receipt side of cash book will increase the cash balance of the organization, hence it is not possible to misappropriate the cash by doing the fictitious entries on the receipt side of cash book.

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Similar questions

Q. Entry which is to be recorded on the receipt side as well as payment side of cash book _____________.

Q. Following facts relate to the business of Roshan who requires you to reconcile his Cash Book with the Pass Book balance:
Balance as per Cash Book (Cr.) - Rs. 2,800
Unpresented cheques - Rs. 3,440
Uncredited cheques - Rs. 2,260
Additional information:
(a) Debit side of the Cash Book (bank column) has been undercast by Rs. 500.
(b) A cheque of Rs. 200 paid to a creditor has been entered by mistake in the Cash Book.
(c) Bank charges Rs. 80 have not been entered in the Cash Book.

On checking Ram’s Cash Book with the Bank statement of his overdraft current account for the month of November, 2012, you find the following:

(i) Cash Book showed an overdraft of Rs 45,000.
(ii) The payment side of the Cash Book had been under cast by Rs 1,500.
(iii) A cheque for Rs 7,500 drawn on his saving account has been shown as drawn on his current account.
(iv) Cheques amounting to Rs 70,000 drawn and entered in the Cash Book had not yet been presented.
(v) Cheques amounting to Rs 60,000 sent to the bank for collection,though entered in the Cash Book,had not been credited by the bank.
(vi) Bank charges of Rs 750 as per Bank Statement had not been taken into the Cash Book.
(vii) Dividends of Rs 25,000 had been paid direct into the bank and not entered in the Cash Book. You are required to prepare a Bank Reconciliation Statement on 30th November, 2012.

Enter the following transactions in cash book.

$\begin{matrix} 2013 & Rs Jan.01 & Cash in hand & 1, 500 Jan.05 & Paid to Ram & 300 Jan.05 & Discount allowed by him & 10 Jan.08 & Purchased goods & 400 Jan.10 & Received from R. Gupta & 980 Jan.10 & Discount allowed & 20 Jan.16 & Sold goods & 400 Jan.21 & Paid to S. Sharma & 295 Jan.21 & Discount received & 5 Jan.25 & Paid wages & 50 Jan.31 & Paid to Narayan in full settlement of his account which shows a credit balance Rs 400 & 390 \end{matrix}$

Q. On Checking Ram's Cash Book with the bank statement of his overdraft current account for the month of November 2014, you find the following:
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(b) The payment side of the Cash Book had been undercast by ₹ 500.
(c) A cheque for ₹ 13,600 drawn on his saving deposit account has been wrongly recorded as drawn on current account in the Cash Book.
(d) Cheques amounting to ₹ 18,800 drawn and entered in the Cash Book had not been presented.
(e) Cheques amounting to ₹ 7,500 sent to the bank for collection though entered in the Cash Book, had not been credited by the bank.
(f) Bank charge of ₹ 150 as per bank statement of account had not been taken in the Cash Book.
(g) Dividend of the amount of ₹ 420 had been paid direct to the bank and not entered in the Cash Book.
You are requested to arrive at the balance as it would appear in the bank statement as on 30th November 2014.

Q. From the following particulars prepare bank reconciliation statement as on 31st March 2015:
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(b) A cheque for ₹ 2,000 issued in favour of X has not been presented for payment.
(c) A bill for ₹ 4,000 retired by bank under a rebate of ₹ 120. The full amount of the bill was credited in Cash Book.
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(f) Payment side of Cash Book has been undercast by ₹ 100.

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