Question

Contra entry does not appear on both the sides of the three column cash book.

• A. True
• B. False

Answer 1

The correct option is B False

Transactions recorded in three column cash book relates to both cash and bank account (i.e. balance of one will decrease and other will increase). Such transactions are entered on both sides of the cash book and are known as Contra Entry. These types of entries require no further posting in any other account. Such entries are marked in the cash book with the letter "C" in the folio column to indicate that these are contra transactions and no further posting is required for them.