Cashbook

What are the types of cashbook in accountancy?

• Credit column cashbook and debit column cashbook

• Profit column cashbook and loss column cashbook

• Income column cashbook and expense column cashbook

• Single column cashbook and double column cashbook

Explain the concept of double column cashbook.

• A double column cashbook is used for recording only credit transactions.

• A double column cashbook is a type of cashbook that has two separate columns for recording cash and bank transactions.

• A double column cashbook is a type of ledger used for recording sales transactions.

• A double column cashbook has columns for recording both cash and non-cash transactions.

Differentiate between single column and double column cashbook.

• Single column cashbook is used for personal transactions, while double column cashbook is used for business transactions.

• Single column cashbook has only one column for each type of transaction, while double column cashbook has two separate columns for each type of transaction.

• Single column cashbook is used for recording income, while double column cashbook is used for recording expenses.

• Single column cashbook has two columns for each type of transaction, while double column cashbook has only one column for each type of transaction.

What are the advantages of using a double column cashbook?

• It makes it harder to reconcile the bank statement

• It is more time-consuming to use

• It provides a separate column for cash and bank transactions, making it easier to reconcile the bank statement.

• It only has one column for all transactions

How are contra entries recorded in a cashbook?

• By using the same amount in both the debit and credit columns for the same date

• By using different dates for the debit and credit entries

• By recording the amount in the credit column only

• By not recording the contra entries at all

Discuss the significance of cashbook in accounting.

• It provides a clear and accurate record of cash inflows and outflows.

• It is not necessary for accurate financial records

• It is only important for small businesses

• It is used to track employee attendance

Explain the purpose of maintaining a cashbook in accountancy.

• To record all cash transactions in a systematic manner.

• To record only credit transactions

• To track the movement of stocks in the company

• To calculate the company's profit and loss

What are the main features of a double column cashbook?

• No columns for recording transactions

• Separate columns for cash and bank transactions

• Separate columns for credit and debit transactions

• Single column for cash transactions only

Provide an example of a contra entry involving bank and cash in a cashbook.

• Depositing cash into the bank

• Transferring cash from one bank account to another

• Withdrawing cash from the bank

• Paying cash for expenses

What is the importance of maintaining a cashbook in business?

• It is only important for large businesses

• It helps in managing inventory

• It is used for recording employee attendance

• It helps in tracking cash transactions and managing cash flow.