Cash Book Flashcards
1
Q
On which side of the CB is i) money in ii) money out
A
i) debit ii) credit
2
Q
What is a contra entry?
A
Transaction involves both cash and bank account
3
Q
Where must the balance of cash always be?
A
Debit
You can’t have negative cash so it cannot be on the credit side
4
Q
What does a credit balance on a bank account mean?
A
Overdrawn
5
Q
What is a I) trade discount II) cash discount
A
I) reduction in price for regular customers
II) reduction in price for prompt payment
6
Q
What discount is recorded in the CB?
A
Cash discount
7
Q
What discount is on the I) debit side II) credit side
A
I) discount allowed
II) discount received
8
Q
What columns of the CB are the I) ledger II) books of prime entry
A
I) cash and bank
II) discount columns
