The Cash Book

The book of original entry in which all cash and bank transactions are recorded is called the ______

• cash book

• purchases book

• journal

• ledger

Which book of original entry is used to record moneis received and paid out by the business trough bank or cash?

• Journal

• Petty cash book

• Return Outwards Journal

• Cash book

True or False. There are 2 types of cash book.

• True

• False

True or False. Monies received by the business are recorded on the credit side of the cash book.

• True

• False

Answer explanation

The debit side is used to record monies received via cheque, cash or bank transfer. Monies come ‘into’ the business are recorded on the debit side.

True or False. Payments made by the business are recorded on the credit side of the cash book.

• True

• False

Answer explanation

The credit side is used to record monies paid out via cheque, cash, or bank transfer. Monies paid out of the business are recorded on the credit side.

Which of the statements below define the term 'discount'?

• A reduction in price

• An increase in price

• Paying only half of the cost price

• Paying by cheque

________ is an allowance given for buying goods in bulk.

• Cash

• Trade discount

• Cash discount

• Transaction

________ an allowance given for quick payment of an account owing.

• Cash

• Trade discount

• Cash discount

• Transaction

True or False. The discount allowed is entered on the debit side of the cash book.

• True

• False

True. False. The Discount received is entered on the debit side of the cash book.

• True

• False