Question

From the following transactions, prepare Cash Book with Cash and Bank Columns:−

2016		(₹)
May 1	Cash in hand	4,800
	Bank Overdraft	30,400
2	Fresh Capital introduced	20,000
3	Deposited into Bank	15,000
4	Sold goods to Mahesh on Credit	6,200
5	An amount of ₹ 4,200 due from Ashok written off as bad debts in the previous year, now recovered.
6	Withdrew from bank for the payment of Life Insurance Premium	3,000
8	Received a cheque form Mahesh for ₹ 6,000 in full settlement of his account and deposited the same into the Bank.
10	Sold goods to Varun on Credit.	30,000
12	Received a cheque for ₹ 28,000 from Varun in full settlement.
15	Cheque received from Varun sent to Bank
18	Varun's cheque returned by Bank dishonoured. Bank charged ₹ 25 on this cheque.
20	Received a cheque of ₹ 6,800 from Vijay which was endorsed to AmritRaj on 23rd May.
25	Withdrew cash from Bank ₹ 5,000 for paying gift to his daughter on her birthday.
26	Bought goods from Gupta General Store for ₹ 10,000 on credit and they allowed us trade discount of 25%.
28	Paid to Gupta General Stores in cash in full settlement	7,000
28	Sale of old machinery, payment received in cash ₹ 7,700.
30	Paid Salary by cheque ₹ 1,500. Paid Rent in cash ₹ 2,200.
31	Paid into Current Account the entire balance after retaining ₹ 5,000 at office.

Answer 1

Cash Book
Dr.										Cr.
Date		Particulars	L.F.	Cash (Rs)	Bank (Rs)	Date	Particulars	L.F.	Cash (Rs)	Bank (Rs)
2016						2016
May 01		Balance b/d		4,800		May 01	Balance b/d			30,400
May 02		Capital A/c		20,000		May 03	Bank A/c	C	15,000
May 03		Cash A/c	C		15,000	May 06	Drawings A/c			3,000
May 05		Bad Debts Recov. A/c		4,200		May 18	Varun			28,025
May 08		Mahesh			6,000	May 25	Drawings A/c			5,000
May 15		Cheques- in-Hand A/c			28,000	May 28	Gupta General Store		7,000
May 28		Machinery A/c		7,700		May 30	Salary A/c		–	1,500
May 31		Cash A/c	C		7,500	May 30	Rent A/c		2,200
May 31		Balance c/d			11,425	May 31	Bank A/c	C	7,500
						May 31	Balance c/d		5,000
				36,700	67,925				36,700	69,925
June 01		Balance b/d		5,000		June 01	Balance b/d			11,425

Working Notes:

WN1

Journal Proper
Date	Particulars					L.F.	Debit Amount (Rs)	Credit Amount (Rs)
2016
May 12	Cheques-in-Hand A/c				Dr.		28,000
	Discount Allowed A/c				Dr.		2,000
	To Varun							30,000
	(Received cheque from Varun)
May 18	Varun				Dr.		2,000
	To Discount Allowed A/c							2,000
	(Cheque received from Varun, dishonoured)
May 20	Cheques-in-Hand A/c				Dr.		6,800
	To Vijay							6,800
	(Received cheque from Vijay)
May 23	Amrit				Dr.		6,800
	To Cheques-in-Hand A/c							6,800
	(Cheque received from Vijay, endorsed to Amrit)

WN2 Cash Deposited into the Bank

Note: Transaction dated May 04, 2016 and May 10, 2016 will not be recorded in Cash Book because credit transactions will not affect the cash/bank balance.