What is a contra entry in a cash book?

A contra entry is a transaction that affects both the Cash and Bank columns of the same cash book. For example, depositing cash into bank: Bank Dr, Cash Cr. Both entries appear in the same book, so they are marked 'C' and not posted separately to the ledger.

What is the imprest system in petty cash?

Under the imprest system, the petty cashier is given a fixed amount (imprest) at the start. After recording all small expenses, the main cashier reimburses exactly the amount spent so the petty cashier always starts fresh with the same imprest amount.

Why are discount columns not balanced in a triple column cash book?

Discount allowed and discount received are nominal accounts. They need to be posted to their respective ledger accounts, not balanced. Only real accounts (cash, bank) are balanced in the cash book.

Types of Cash Book

Cash Book • Class 11 Accountancy • NCERT • CBSE

Cash Book is both a Journal and a Ledger. Simple cash book: only cash. Double column: cash + bank. Triple column: cash + bank + discount. Petty Cash Book: small daily expenses using imprest system. Debit side = receipts, Credit side = payments.

Frequently Asked Questions

What is a contra entry in a cash book?: A contra entry is a transaction that affects both the Cash and Bank columns of the same cash book. For example, depositing cash into bank: Bank Dr, Cash Cr. Both entries appear in the same book, so they are marked 'C' and not posted separately to the ledger.
What is the imprest system in petty cash?: Under the imprest system, the petty cashier is given a fixed amount (imprest) at the start. After recording all small expenses, the main cashier reimburses exactly the amount spent so the petty cashier always starts fresh with the same imprest amount.
Why are discount columns not balanced in a triple column cash book?: Discount allowed and discount received are nominal accounts. They need to be posted to their respective ledger accounts, not balanced. Only real accounts (cash, bank) are balanced in the cash book.

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