Question

Closing balance of cash book is _____________ balance.

• A. Debit
• B. Credit
• C. Zero
• D. Either (A) or (C)

Answer 1

Answer: (D)

Either (A) or (C)

Total of the debit side of the cash book or cash A/c always exceeds its credit side because payments of a business cannot exceed the receipts amount. So, the cash book shows debit balance. When payments are exactly equal to the receipt of the business, it will show zero balance, but it can never show the credit balance. Thus, the cash book will always show debit balance or zero balance.