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

Adjustment entry

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No entry

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Contra entry

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Transfer entry

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Solution

The correct option is D Contra entry
When there is a transaction that relates to both cash and bank, this will be written on one side of bank column and on other side of cash column. Such transactions are known as "Contra entries". In case cash is withdrawn from bank for office use, its is entered on the credit side of bank column and also in the debit side of cash column of the cash book. In case cash is deposited in the bank, the amount is recorded on the debit side of bank column and on the credit side of cash column of the cash book. The letter "C" is written in the LF column on both sides against these entries. These entries are not to be posted into ledger.

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Similar questions

State whether the following statements are TRUE or FALSE :

1. Total of payments side can be greater than total of receipts side in case of bank column.
2. Purchase of asset or stationery on credit is recorded in purchase book.
3. When goods are returned by buyer to seller, buyer sends a debit note.
4. Cheque received and deposited into bank on the same day is a contra entry.
5. Simple petty cash book is not very popular.
6. Interest on overdraft charged by bank is recorded in the cash column.
7. It is not necessary to record dishonor of cheques in the cash book.
8. Cheque book facility is available for fixed deposit account.
9. Businessman generally operates savings bank account.
10. A cash book is both a journal as well as ledger.
11. Cash book is a book of original entry.
12. Cash discount allowed is recorded on the debit side of cash book
13. Credit transactions are never recorded in cash book.
14. Endorsed cheques are always recorded on the payment side in the bank column.
15. A person who endorses the cheque is known as endorser.

Q. An entry recorded on both sides of cash Book is known as _______ entry.

An entry which is made on both sides of a cash book is called ___.

Q. Transaction recorded both on debit and credit side of cash book is known as contra entry.

In which book of original entry will:

(i) The partial recovery from Mr. Ajay of an amount of Rs. 4,000 earlier written off as bad debts be recorded?

(ii) In which book of original entry, a discount of Rs. 50 offered for an early payment of cash of Rs. 1,050 be recorded?

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