Cash book is a book in which receipts and payments are recorded. It is part of ledger as well as book of original entry.
It records receipts and payments of cash.
Records receipts and payments of money by cheque.
RECORDING TRANSACTIONS IN A CASH BOOK.
Receipts of cash in cash book you debit cash account.
Payment of cash from cash account you credit cash account.
Receipt of Money by cheque you debit bank account.
Payment of money by cheque you credit bank account.
TWO COLUMN CASH BOOK.
This cash book is ruled with both debit and credit side having both cash and bank transactions.
CONTRA ENTRIES ‘C’
It’s an entry which affects one account which is credited and another account which is debited with the same amount.
It’s normally abbreviated with a letter ‘C’ on the folio column.
In a two column cash book, payment of cash into the bank and withdrawal s of cash from the bank account are recorded on the same page but on opposite sides of the cash book. These are Contra entries and indicated by ‘c’ on the folio column.