RECORDING OF TRANSACTIONS

TRANSACTIONS RELATED BANKS:

1. Cash deposited into the bank

Bank a/c Dr.

To Cash a/c

2. Cash withdrawn for office use.

Cash a/c Dr.

To Bank a/c

3. When cheque is received from customer and deposited into bank same day.

Bank a/c Dr.

To Customer’s personal a/c

4. When cheque is received from customer and not deposited into bank same day.

Cash a/c Dr.

To Customer’s personal a/c

5. When above cheque (Point 4) is deposited later into bank.

Bank a/c Dr.

To Cash a/c

6. When payment is made through cheque.

Personal a/c Dr.

To Bank a/c

7. When expenses is paid through cheque.

Expense a/c Dr.

To Bank a/c

8. When interest is allowed by the bank.

Bank a/c Dr.

To Interest a/c

9. When Bank charges for the services provided.

Bank Charges a/c Dr.

To Bank a/c

Some special entries :

1. Bad Debts (when customer is declared insolvent and amount is irrecoverable from him)

Cash a/c Dr. (If partial amount is recovered)

Bad Debts a/c Dr. (the irrecoverable part)

To Personal a/c (the due amount)

2. Bad debts recovered earlier written off as bad debts.

Cash a/c Dr.

To Bad debts recovered a/c

3. Outstanding Expenses (expenses due but not paid yet).

Expenses a/c Dr.

To Outstanding Expenses a/c

4. Prepaid Expenses (Expenses not due but paid in advance).

Prepaid expenses a/c Dr.

To Expenses a/c

5. Accrued income (income due but not received yet).

Accrued Income a/c Dr.

To Income a/c

6. Unearned Income (Income not due but received in advance).

Income a/c Dr.

To Unearned Income a/c

7. Depreciation provided on fixed assets.

Depreciation a/c Dr.

To Related asset’s a/c

8. Interest on Capital provided.

Interest on capital a/c Dr.

To Capital a/c

9. Interest on Drawings charged.

Drawings a/c Dr.

To Interest on Drawings a/c

BOOKS OF ORIGINAL ENTRY/SPECIAL PURPOSE BOOKS :

As size of the business grows and number of transactions increases, it becomes necessary for the business to divide the recording work. The books maintained are illustrated below :

Transactions	Further classification	Subsidiary Books Maintained
Cash and Bank related transactions	Only Cash Transaction	Simple Cash Book
	Cash & Bank Transactions	Double Column Cash Book
	Cash payment of small Amount	Petty Cash Book
Transactions other than cash and Bank	Credit Sales	Sales Book
	Credit Purchase	Purchases Book
	Sales Return	Sales Return Book
	Purchase Return	Purchase Return Book
	Transactions of Bills Receivable	Bills Receivable Book
	Transactions of Bills Payable	Bills Payable Book
	Any Other Transactions	Journal Proper

CBSE Accountancy Class XI ( By Mr. Kailash Gururani )
Email Id : [email protected]