INTERVIEW QUESTIONS ACCOUNTING PROCESS CASH BOOKS DETAILS

Question: If the debit and credit aspects of a transaction are recorded in the cash book it is a: a) Contra Entry b) Simple Entry c) Double Entry d) Single Entry

Answer: (a) Contra Entry
Description: Sometimes cash is withdrawn from bank for use in the office. In such a case the amount is entered in the bank column on the payments side and also in the cash column on the receipts side. Reverse happens when cash is deposited in bank. Against such entries, the letter 'C' is written in L.F. column, to indicate that these are contra items and no further posting is required for them.

(a) Contra Entry
Description: Sometimes cash is withdrawn from bank for use in the office. In such a case the amount is entered in the bank column on the payments side and also in the cash column on the receipts side. Reverse happens when cash is deposited in bank. Against such entries, the letter 'C' is written in L.F. column, to indicate that these are contra items and no further posting is required for them. Source: CoolInterview.com

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