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CBSE » Class XI » Accountancy

» TS Grewal Accountancy Class 11 Solution Chapter
10 Special Purpose Books I Cash Book

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TS Grewal Accountancy Class

11 Solution Chapter 10 Special
Purpose Books I Cash Book
Accountancy Download PDF

Read TS Grewal Accountancy Class 11 Solution

Chapter 10 Special Purpose Books I Cash Book (2019-
2020) below, students should study TS Grewal class 11
Accountancy available on Studiestoday.com with
solved questions and answers. These chapter wise
answers for class 11 Accountancy have been prepared
by teacher of Grade 11. These TS Grewal class 11
Solutions have been designed as per the latest NCERT
syllabus for class 11 and if practiced thoroughly can
help you to score good marks in standard 11
Accountancy class tests and examinations

Question.1. Why is it necessary to sub-divide a

Journal? What are its advantages?

Answer  1.  It is convenient to maintain a separate

book for each such class of transactions-one to record
cash transactions, another to record credit purchase of
goods and yet another to record credit sale of goods.
All of these books are called the books of original entry
or primary entry or subsidiary books - it is a special
form of Journal, a sub-division of Journal.

Advantages of Subsidiary Books:

(i) Division of Work: Since in the place of one Journal

there are many subsidiary books, accounting work can
be divided among a number of persons.

(ii) Specialization and Efficiency: When the same

work is handled by a particular person for a
considerable time, he acquires expertise in it and
becomes efficient in handling it. Thus, accounting is
done more efficiently.

(iii) Saving of Time: Various accounting processes can

be undertaken simultaneously because of the use of
number of books. Thus, it leads to saving of time.

(iv) Availability of Information: Since a separate book

is maintained for each class of transactions, information
relating to each class is available at one place.

(v) Facility in Checking: When the Trial Balance does

not agree, location of error or errors is facilitated by the
existence of separate books. Since the number of
transaction will be considerably less as compared to
only one Journal, it would become easy to locate the
errors.

(vi) Responsibility: Division of work results in

assigning a particular job to a particular person. If an
error is committed in recording, responsibility can be
easily fixed.

Question.2. What is a Cash Book? What are the

types of Cash Book? How is it balanced?

Answer  2.  Cash Book is a book of prime entry in

which cash and bank transactions are recorded in a
chronological order, i.e., as they occur. Cash receipts
are recorded on the debit side of the Cash Book and
cash payments on the credit side. A balance is struck
by deducting the total cash payments from the total
cash receipts to know the cash in hand necessary and
useful information. The number of cash transactions in
a firm is generally large; therefore, it is convenient to
have a separate Cash Book to record such
transactions.

The following are the types of Cash Books:-

(i) Simple Cash Book or Single Column Cash

Book:For recording cash transactions only.

(ii) Two—Column Cash Book (Cash Book with cash

and bank columns): For recording cash and bank
transactions.

(iii) Three—Column Cash Book (Cash Book with

cash, bank and discount columns): In this cash book
there are three columns of amount of both the sides.
The first for discount, the second for cash and the third
for bank transactions. Discount allowed is recorded on
the debit side, while discount received is recorded on
the credit side.

(iv) Petty Cash Book: Petty Cash Book is the Book

which is used for the purpose of recording expenses
involving small amounts.

The cash books are balanced like ordinary ledger

accounts.

 
Question.2. Name and describe the various books
of original entries.(Old Question)

Answer  2.   The following are the names and

descriptions of the various books of original entries:

We had discussed earlier that it is practically difficult to

record all the transactions in only one book of prime
entry. For convenience, the Journal is divided into a
number of Subsidiary Books. These are:

1. Cash Book: To record receipt and payments of

cash, including receipts into and payments out of the
bank.

2. Purchase Book: To record credit purchases of

goods dealt in by the firm. All credit purchases of goods
are recorded in this book.

3. Sales Book: To record the credit sales of goods

dealt in by the firm.

4. Purchases Return Book: To record the return of

goods previously purchased on credit.

5. Sales Return Book: To record the return of credit

sales made by customers.

6. Bills Receivable Book: To record the receipt of

promissory notes or bills drawn by firm and accepted
by debtors.

7. Bills Payable Book: To record the issue of

promissory notes and bills accepted by the firm.

8. Journal Proper: To record the transactions which

cannot be recorded in any of the seven books
mentioned above.

It may be noted that in all the above cases the word

'Journal' may be used for the word 'book'.

Question.3. “Cash Book always shows a debit

balance.” How far is this statement true and why?

Answer  3.   Cash book cannot have a Credit Balance

or Cash Book always shows a debit balance. Cash
Column in the Cash Book cannot show a credit balance
because cash payments cannot exceed cash receipts.
At best, it can show nil balance when total cash receipt
are equal to total payment.

Question.4. What is a Contra Entry? How is it

recorded? Give two examples of a Contra Entry.

Answer  4.   Contra Entry: Some transactions are

recorded in a Two-Column Cash Book which relate to
both cash and bank, i.e., balance of one will decrease
and the other will increase due to such transactions.
Such transactions are entered on both sides of the
Cash Book. Such entries are knows as Contra Entries.
Let us take an example to understand it better.

(a) Cash deposited into the Bank 10,000: In this

transaction, Bank Account is to be debited and Cash
Account is to be credited. Debit aspect is recorded on
the debit side of the Bank Column and credit aspect is
recorded on the credit side of Cash Column.

(b) Cash withdrawn from Bank for Office Use 1,000:

In this transaction Cash Account is to be debited and
Bank Account is credited. Debit aspect is recorded on
the debit side of the Double Column Cash Book in the
Cash Column and credit aspect is recorded on the
credit side of the Double Column Cash Book in the
Bank Column.

Against such entries, the letter 'C' is written in the L.F.

column to indicate that these are contra transactions
and are not posted into the Ledger Account.

Question.5. State reasons for the following:

(i) The balance in the cash column of the Cash

Book is always a debit balance whereas that in the
bank column can sometimes is credit.

(ii) Contra entries in the Two-Column Cash Book

are not posted into the ledger.

(iii) The Cash Account and the Bank Account are

not posted in the Ledger.

Answer 5.   The reasons for the following are:

(i) The balance in the cash column of the Cash Book is

always a debit balance whereas that in th bank column
can sometimes be credit. Cash Column in the Cash
Book cannot show a credit balance because cash
payments cannot exceed cash receipts. At best, it can
show nil balance when total cash receipts are equal to
total payments. Whereas in the bank column we can
pay more than what we have in the bank due to
overdraft arrangements with the bank and in that case
the bank column will so a credit balance.

(ii) Contra entries in the Two-Column Cash Book are

not posted into the Ledger. Some transactions are
recorded in a Two-Column Cash Book which relate to
both cash and bank, i.e., balance of one will decrease
and the other will increase due to such transactions.
Such transactions are entered on both sides of the
Cash Book. Such entries are knows as Contra Entries.
Against such entries, the letter 'C' is written in the L.F.
column to indicate that these are contra transactions
and are not posted into the Ledger Account as the
Cash Book is a combination of Cash Ledger and Bank
Ledger.

(iii) The Cash Account and the Bank Account are not
posted in the ledger. Some transactions are recorded in
Two-Column Cash Book which relate to both cash and
bank, i.e., balance of one will decrease and the other
will increase due to such transactions. Such
transactions are entered on both sides of the Cash
Book. Such entries are knows as Contra Entries.
Against such entries, the letter 'C' is written in the L.F.
column to indicate that these are contra transactions
and are not posted into the Ledger Account as the
Cash Book is a combination of Cash Ledger or Account
and Bank Ledger or Account.

Question.6. What is a Petty Cash Book? Why is it

maintained?

Answer  6.  Petty Cash Book is the book which is used

for the purpose of recording expenses involving petty
amounts. Besides petty expenses, receipts from main
cash are recorded. Petty Cash Book is prepared by
Petty Cashier and acts as the Petty Cash Account. It is
maintained as in a business besides large payments,
number of small payments, such as for conveyance,
stationary, cartage, etc., have to be made. If all these
payments are recorded in the Cash Book, it will
become unnecessarily large. Also, the main cashier will
be overburdened with work. Therefore, it is usually for
firms to appoint a person as 'Petty Cashier' and to
entrust the task of making small payments, say, below
250, to him. Of course, he is reimbursed for the
payments made. The respective accounts are debited.

Question.7. Explain the meaning of Imprest System

of Petty Cash Book.

Answer   7.  The imprest system of Petty Cash is

explained below. Under this system, an estimate is
made of amount required for petty expenses for a
certain period (say for a week, a fortnight or a month).
The amount so ascertained is given to the petty cashier
in the beginning of a period and is reimbursed the
amount paid by him during the period. Thus, he will
again have the fixed amount in the beginning of the
new period. This amount is called imprest money. This
system of paying advance in the beginning and
reimbursing the amount spent from time to time is
called imprest system.

 
Question.8. Explain the method of posting a Petty
Cash Book.(Old Question)

Answer  8.   The expiation of the method of posting a

Petty Cash Book is explained below as: Petty cash
given to the Petty Cashier for small payments is
recorded on the credit side of the Cash Book as 'By
Petty Cash Account' and is posted to the debit side of
the Petty Cash Account in the Ledger. All payments are
recorded in the particulars column as 'By Particular
Petty Expenses Account' and the amount is posted in
the total column along with individual Petty Expenses
column.

Practical Problems :---->

Question 1:  Enter the following transactions of Mr.

Ripinder, Delhi in a Single Column Cash Book and
balance it:

Answer 1:

Format of Single Column Cash Book on the basis

of given transactions

Point of Knowledge:-

(i)            In the cash book only cash transaction are

recorded. Credit transactions are not recorded.

(ii)           The debit side is always greater than the

credit as payments are never exceeds the cash
available.

Question 2:  Prepare Simple Cash book of Gopal of

Amritsar from the following transactions:

Answer 2:

Format of Simple Cash Book on the basis of given

transactions

Question 3:  Prepare Simple Cash Book from the

following transactions of Simran, Delhi:

Answer 3:

Format of Simple Cash Book on the basis of given

transactions

Point of Knowledge:-

(i)            If a firm maintained Cash Book then it

need not to make cash account separately.

Question 4:  From the following prepare Single

Column Cash Book of Suresh, Chennai and post
them into ledger accounts:

Answer 4:

Format of Single Column Cash Book on the basis

of given transactions

Point of Knowledge:-

(i)            Cash book is maintained to record only

cash transaction so, the credit purchases are not
recorded in the cash book.

Question 5: Record the following transactions in

Double Columns Cash Book and balance the book
on 31st March, 2021: 

Answer 5:

Format of Double Column Cash Book on the basis

of given transactions

Point of Knowledge:-

(1)   Contra Entry is an entry which includes both Cash

& Bank Account and it is recorded in both debit & credit
side of the double column cash book. When a contra
entry posted in cash book there is a reference column,
the letter “C” is written this denotes that the entry is a
contra entry.

(2)   This entry will not be posted to any ledger account.

Question 6:  Prepare Two-column Cash Book of

Bimal, Lucknow from the following transactions:

Answer 6:

Format of Two Column Cash Book on the basis of

given transactions

Point of knowledge:-

(i)             When a cheque is received and deposited

into the bank on the same day the amount of the
cheque is entered in the bank column on debit side.

(ii)            When a cheque is received and does not

represent on the same day, the amount of the cheque
is entered in the cash column.

Question 7:  Prepare Two-column Cash Book from

the following transactions of Mani, Kochi;

Answer 7: 

Format of Two Column Cash Book on the basis of

given transactions

Question 8:  Prepare Two-column Cash Book of

Vinod, Delhi from the following transactions:

Answer 8:

Point of Knowledge:-

(i)            The contra entry is done when the cash is

withdrawn for business use. If cash is withdrawn
for personal use, it will be entered in the bank
column of credit side of the cash book.

Question 9:  Enter the following transactions in

Two-column Cash Book of Reema, Chandigarh and
find out cash and bank balances:     

Answer 9:

Format of Two Column Cash Book on the basis of

given transactions:

Question 10:  Write the following transactions in

the Cash Book of Premium Stores, Kolkata
(Proprietor Amrit Kumar):     

Answer 10:

Format of Two Column Cash Book on the basis of

given transactions

Question 11:  Enter the following transactions in

Two-column Cash Book of Gaurav, Delhi:      

Answer 11:

Format of Two Column Cash Book on the basis of

given transactions

Point of Knowledge:-

(i)             Below is the Journal of Some tricky

transactions

Question 12:  From the following information,

prepare an Analytical Petty Cash Book:

Answer 12:

Format of Analytical Petty Cash Book on the basis

of given transactions

Question 13:  Rajan maintains a Columnar Petty

Cash Book on the Imprest System. The imprest
amount is Rs 5,000. From the following information,
show how his Petty Cash Book would appear for
the week ended 12th September, 2020:

Answer 13:

Format of Columnar Petty Cash Book on the basis

of given transactions
Question 14:  A Petty Cashier in a firm received
Rs.15,000 as the petty cash imprest on 4th June,
2021. During the week, his expenses were as
follows:

Write up the Analytical Petty Cash Book and draft

the necessary Journal entries for the payments
made. 

Answer 14:

Format of Analytical Petty Cash Book on the basis

of given transactions:

Point of Knowledge:-

Advantages of Petty Cash Book:-

(i)            Time Saving Activity.

(ii)           Provides Control on Small payments.

(iii)          Saving the labour to writing up the posting

into the ledger.

Question 15:   From the following information,

prepare an Analytical Petty Cash Book:

Answer 15:

Question 16:  The following transactions took place

during the week ended 28th May, 2019. How will
you record them in the Petty Cash Book which was
maintained with a weekly 'float' of ₹ 3,000?

Answer 16:

Question 17:  Sri R maintains a Columnar Petty

Cash Book on the Imprest System. The imprest
amount is Rs 5,000. From the following information,
show how his Petty Cash Book would appear for
the week ended 12th September, 2017:

Answer 17:

Question 18:  With Goods and Services Tax (GST)

A Petty Cashier in a firm received ₹15,000 as the

petty cash imprest on 4th June, 2017. During the
week, his expenses were as follows:

Write up the Analytical Petty Cash Book and draft

the necessary Journal entries for the payments
made. 

Answer 18:

Format of Analytical Petty Cash Book on the basis

of given transactions:

Point of Knowledge:- Advantages of Petty Cash

Book.

(i)            Time Saving Activity.

(ii)           Provides Control on Small payments.

(iii)          Saving the labour to writing up the posting into

the ledger.

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Material
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" TS Grewal Class 11 Solutions: Double Entry
Book Keeping Financial Accounting

TS Grewal Accountancy Class 11 Solution

Chapter 1 Introduction of Accounting

TS Grewal Accountancy Class 11 Solution

Chapter 2 Basic Accounting Terms

TS Grewal Accountancy Class 11 Solution

Chapter 3 Accounting Standards and IFRS

TS Grewal Accountancy Class 11 Solution

Chapter 4 Bases of Accounting

TS Grewal Accountancy Class 11 Solution

Chapter 5 Accounting Equation

TS Grewal Accountancy Class 11 Solution

Chapter 6 Accounting Procedures Rules of Debit
and Credit

TS Grewal Accountancy Class 11 Solution

Chapter 7 Origin of Transactions Source
Documents and Preparation of Voucher

TS Grewal Accountancy Class 11 Solution

Chapter 8 Journal

TS Grewal Accountancy Class 11 Solution

Chapter 9 Ledger

TS Grewal Accountancy Class 11 Solution

Chapter 10 Special Purpose Books I Cash Book

TS Grewal Accountancy Class 11 Solution

Chapter 11 Special Purpose Books II Other Book

TS Grewal Accountancy Class 11 Solution

Chapter 12 Accounting of Goods and Services
Tax (GST)

TS Grewal Accountancy Class 11 Solution

Chapter 13 Bank Reconciliation Statement

TS Grewal Accountancy Class 11 Solution

Chapter 14 Trial Balance

TS Grewal Accountancy Class 11 Solution

Chapter 15 Depreciation

TS Grewal Accountancy Class 11 Solution

Chapter 16 Provisions and Reserves

TS Grewal Accountancy Class 11 Solution

Chapter 17 Accounting for Bills of Exchange

TS Grewal Accountancy Class 11 Solution

Chapter 18 Rectification of Errors

TS Grewal Accountancy Class 11 Solution

Chapter 19 Financial Statements of Sole
Proprietorship

TS Grewal Accountancy Class 11 Solution

Chapter 20 Adjustments in Preparation of
Financial Statements

TS Grewal Accountancy Class 11 Solution

Chapter 21 Accounts from Incomplete Records
Single Entry System

TS Grewal Accountancy Class 11 Solution

Chapter 22 Computers in Accounting

TS Grewal Accountancy Class 11 Solution

Chapter 23 Accounting Software Tally

" TS Grewal Class 11 Solutions: Double Entry

Book Keeping Financial Accounting (Old
Book)

TS Grewal Accountancy Class 11 Solution

Chapter 1 Basic Accounting Terms

TS Grewal Accountancy Class 11 Solution

Chapter 2 Accounting Equation

TS Grewal Accountancy Class 11 Solution

Chapter 3 Accounting Procedures Rules of Debit
and Credit

TS Grewal Accountancy Class 11 Solution

Chapter 5 Journal

TS Grewal Accountancy Class 11 Solution

Chapter 7 Origin of Transactions Source
Documents and Preparation of Voucher

TS Grewal Accountancy Class 11 Solution

Chapter 7 Special Purpose Books Cash Book

TS Grewal Accountancy Class 11 Solution

Chapter 9 Bank Reconciliation Statement

TS Grewal Accountancy Class 11 Solution

Chapter 10 Trial Balance

TS Grewal Accountancy Class 11 Solution

Chapter 11 Depreciation

TS Grewal Accountancy Class 11 Solution

Chapter 12 Accounting for Bills of Exchange

TS Grewal Accountancy Class 11 Solution

Chapter 13 Rectification of Errors

# TS Grewal for Class XI Accountancy

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