CASH BOOK & BANK RECONCILIATION STATEMENT

DEFINE CASH BOOK. A book which is used to record cash transaction is called cash book. Cash receipts are recorded on the left side and cash payments are recorded on the right side. DEFINE SINGLE COLUMN CASH BOOK. The single column cash book makes a record of only cash transactions. Cash receipts are recorded on the left side and cash payments are recorded on the right side. DEFINE THE DOUBLE COLUMN CASH BOOK. The cash book in which cash and bank or cash and discount transactions are recorded is called double column cash book. DEFINE TREBLE COLUMN CASH BOOK. The cash book in which cash bank and discount transactions are recorded is called treble or three column cash book. EXPLAIN CONTRA ENTRY. An entry which is recorded on the both sides of cash book is called contra entry. or An entry in which cash account and bank account are involved and it is recorded on both side of cash book is called contra entry. DEFINE SUBSIDIARY BOOKS. The journal is sub-divided into different journals known as the subsidiary books/special journals e.g. Cash book Purchase journal Sales journal Purchases return journal Sales return journal B/R book B/P book DEFINE PURCHASES BOOK (INVOICE BOOK). A book in which only transactions of credit purchases are recorded is called purchases book. DEFINE SALES BOOK. A book in which only transactions of credit sales are recorded is called sales book. DEFINE SALES RETURN BOOK. A book in which all credit sales returned by customer are recorded is called sales return book. DEFINE PURCHASES RETURNS BOOK. A book in which all credit purchases returned to supplier are recorded is called purchases return book. EXPLAIN PETTY CASH BOOK. The book in which small payments are recorded which are not convenient to record in the cash book is called petty cash book.

PUNJAB COLLEGE OF COMMERCE

PROF. HAFIZ MUHAMMAD NAWAZ

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CASH BOOK & BANK RECONCILIATION STATEMENT

DEFINE DEBIT NOTE. If goods bought on credit are returned to the seller for any solid reasons the buyer debit seller account and inform the seller through a note. This note is called debit note. DEFINE CREDIT NOTE. If goods sold on credit are returned by the buyer the seller credits buyer account and informs the buyer through a note. This note is called credit note. WHAT IS BANK RECONCILIATION STATEMENT? It is a statement which contains a complete and satisfactory explanation of the differences in balances as per cash book and pass book. DEFINE PASS BOOK. It is a book prepared by bank which contains detail about the deposits and withdrawals of the account holder. GIVE SOME EXAMPLES OF DISAGREEMENT BETWEEN CASH BOOK AND PASS BOOK. The following are some examples of disagreement: Cheques issued but not presented Cheques deposited but not credited Bank charges Any mistake made by bank Any mistake made customer DEFINE BANK OVERDRAFT / OVERDRAFT / OVERDRAWN The amount which a bank allowed to a customer to withdraw in excess of his deposits is called bank overdraft. DEFINE UN-PRESENTED CHEQUE. Cheque issued but not presented for payment is called un-presented cheque or Un-paid cheque or outstanding cheque. DEFINE UN-CREDITED CHEQUE. Cheque deposited into the bank by the customer but not credited by the bank is called un-credited cheque or un-collected cheque or un-cleared cheque

PUNJAB COLLEGE OF COMMERCE

PROF. HAFIZ MUHAMMAD NAWAZ

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