TWO COLUMN CASHBOOK.
Hey Guys, Happy Wednesday. It’s a new day to live and learn,
and we are continuing our previous topic on Cashbook. So sit back, relax and
gain knowledge today.
Two Column
Cashbook is a combination of the Cash Account and Bank Account for the
sake of convenience. There are separate columns for Date, Particulars, Folio,
Cash and Bank on both the Debit and Credit sides.
Cash
Column: contains cash receipts and payments.
Bank
Column: contains all payments made by cheque and money received and
paid into the Bank.
Contra Entries:
are entries made in the cashbook when cash is deposited into the bank
account out of cash in hand or when cash is withdrawn from the bank for office
use.
Cash paid
into the Bank: when there is surplus of cash in hand, the firm can pay it
into the bank. Cash balance will decrease and Bank balance will increase.
Cash Column will be credited, Bank Column will be debited.
There must be a letter “C” put in the folio column of both sides to signify
that it’s a contra entry.
For
Example: Cash received of N500
was paid into the Bank.
Dr Cash Book. Cr
Date Particulars
F Cash Bank Date
Particulars F Cash Bank
Jan 1 Cash c 500 Jan 1
Bank c 500
Withdrawal
from Bank: when there is shortage of cash in hand, money can be
withdrawn from Bank. Bank balance decreases while Cash balance increases.
Bank Column will be credited while Cash Column will be debited
and also a “C” will be put in the
