basic details of cash book and its entries .

1. PRINCIPLE OF ACCOUNTINGS
FINAL PRESENTATION
DUA-IFTIKHAR: BB-27975
FAIZA-MUNEER: BB-27946
“ ILMA UNIVERSITY ”

2. CASH-BOOK
FEATURES OF CASH BOOK.
TYPES OF CASH BOOK.
STEPS FOR VERIFICATION OF CASH BALANCE.
STEPS FOR BALANCING CASH BOOK.
CONTRA ENTRIES.

3. INTRODUCTION
• Cash-book is a book which is maintained in
all organization. In this book all cash receipts
and payments are recorded in chronological
order.
• All cash transactions are first entered in cash
book and then posted from cash book into
ledger.
• Cash book is maintained in ledger form with
narrations.

4. FEATURES OF CASH BOOK
Following are the features:
• Only cash transactions are recorded.
• It performs both functions as journal and
ledger at same time.
• All cash receipts are recorded in debit side.
• All cash payments are recorded in credit
side.
• It record only one aspect i.e., cash.

5. TYPES OF CASH BOOK
1. Single Column Cash Book.
2. Two Columns Cash Book.
3. Three Columns Cash Book.
SINGLE COLUMN CASH BOOK:
The single column cash book makes
a record of only cash transactions.

6. DAT
E
PARTICULARS P/R AMOUNT DATE PARTICULARS P/R AMONUNT
SINGLE COLUMN CASH BOOK

7. TWO COLUMNS CASH BOOK:
It is similar to single column
except it contains an additional
column for bank.

8. TWO COLUMN CASH BOOK
DAT
E
PARTICULARS P/R CASH BANK DAT
E
PARTICULARS P/R CASH BANK

9. THREE COLUMNS CASH BOOK:
Three columns cash book
contains
Cash, Bank and Discount transactions.
Three columns provided on either side
of cash book.

10. THREE COLUMN CASH BOOK
DAT
E
PARTICU
LARS
P/R DISC
OUNT
CASH BANK DAT
E
PARTICU
LARS
P/R DISC
OUNT
CASH BANK

11. STEPS FOR VERIFICATION OF CASH
BALANCE
There are three steps :
•Balancing of cash book.
•Counting of physical cash.
•Comparing physical cash with cash book
balance.

12. CONTRA ENTRIES:
The term ‘Contra’ refers to
opposite
side. When both debit and credit aspect
of transactions are recorded in same
account but in different columns, each

13. entry whether debit or credit side shall
be deemed to be contra entry.
EXAMPLE:
Contra entries are:
• Cash deposited into bank.
• Cash withdrawn from bank.

14. STEPS FOR BALANCING THE CASH
BOOK:
Following steps are followed in balancing
Cash book:
1. Add up debit side of cash book with pencil.
2. Add up credit side of cash book with pencil.
3. Compute the difference of total of both
sides.
4. Enter this balance in side with smaller total
as ‘By Balance b/d ‘.
5. Erase the pencil total.

15. 6. Draw a single line just below the balance
amount on both sides.
7. Now re-add both sides including balance.
Total of each side should be same.
8. Carry down the balance to opposite side
as ‘To Balance b/d’ now cash book ready
for making entries in next week or month.

16. The following transactions of DAWOOD BUILDERS
for the month of March 2004 :
March
s.no TRANSACTIONS AMOUNTS
1 : Balance of cash in hand Rs . 15,000
1 : Balance of cash at bank 75,000
1 : Cash received from a customer on account of
cash sales
8,000
2 : Cash deposited into bank 5,000
5 : Cash paid for salary of staff 12,000
6 : Paid cash for telephone bill 800
9 : Sold merchandise on cash 20,000
12 : Purchased merchandise on cash 9,000

17. S.NO PARTICULARS AMOUNTS
15 : Received a cheque from a customer and
deposited into bank
16,000
16 : Received cheque from ALAM AND ALAM 35,000
17 : Purchased merchandise and paid by cheque 8,500
18 : Deposited cheque of ALAM AND ALAM into
bank
22 : Withdrew cash from bank for office use 10,500
23 : AHSAN withdrew cash from bank for his
personal use
6,000
25 : Paid office rent by cheque 6,500
28 : Issued chaque for advertisement 3,500

18. • Enter the transactions into a Three-
Column Cash Book
• Balance the cash book on march 31 ,
2004
• Bring down the balance on april 1,
2004

19. DAWOOD BUILDERS
CASH BOOK (THREE-COLUMN)
For the month of march 2004

21. THANKYOU