Recording of Transactions 2 NCERT Textbook With Solution PDF

NCERT Solutions for Class 11 Accountancy Chapter 4 Recording of Transactions 2′ PDF Quick download link is given at the bottom of this article. You can see the PDF demo, size of the PDF, page numbers, and direct download Free PDF of ‘Transaction Recording’ using the download button.

Recording of Transactions 2 Textbook With Solution PDF Free Download


Chapter 4: Recording of Transactions- 2

In chapter 3, you learned that all the business transactions are first recorded in the journal and then they are posted in the ledger accounts.

A small business may be able to record all its transactions in one book only, i.e., the journal. But as the business expands and the number of transactions becomes large, it may become cumbersome to journalize each transaction.

For the quick, efficient, and accurate recording of business transactions, Journal is sub-divided into special journals.

 Many of the business transactions are repetitive in nature. They can be easily recorded in special journals, each meant for recording all the transactions of a similar nature.

For example, all cash transactions may be recorded in one book, all credit sales transactions in another book and all credit purchase transactions in yet another book, and so on. These special journals are also called daybooks or subsidiary books.

 Transactions that cannot be recorded in any special journal are recorded in a journal called the Journal Proper. Special journals prove economical and make the division of labor possible in accounting work.

In this chapter we will discuss the following special purpose books: • Cash Book • Purchases Book • Purchases Return (Return Outwards) Book • Sales Book • Sales Return (Return Inwards) Book •

Journal Proper 4.1 Cash Book is a book in which all transactions relating to cash receipts and cash payments are recorded. It starts with the cash or bank balances at the beginning of the period. Generally, it is made on monthly basis.

This is a very popular book and is maintained by all organizations, big or small, profit or not-for-profit. It serves the purpose of both journals as well as the ledger (cash) account.

It is also called the book of original entry. When a cashbook is maintained, transactions of cash are not recorded in the journal, and no separate account for cash or bank is required in the ledger. 4.1.1.

Single Column Cash Book The single column cash book records all cash transactions of the business in chronological order, i.e., it is a complete record of cash receipts and cash payments.

When all receipts and payments are made in cash by a business organization only, the cash book contains only one amount column on each (debit and credit) side.

The format of the single-column cash book is shown in figure 4.1. Ca  In this type of cash book, there are two columns of amounts on each side of the cash book.

In fact, nowadays bank transactions are very large in number. In many organizations, as far as possible, all receipts and payments are affected by banks. A businessman generally opens a current account with a bank.

Banks, do not allow any interest on the balance in the current account but charge a small amount, called incidental charges, for the services rendered.

For depositing cash/cheques in the bank account, a form has to be filled out, which is called a pay-in-slip. (refer figure 4.2) It contains a counterfoil also which is returned to the customer (depositor) with the signature of the cashier, as a receipt.

The bank issues blank cheque forms, to the account holder for withdrawing money. (refer to figure 4.3) The depositor writes the name of the party to whom payment is to be made after the words Pay printed on the cheque.

Language English
No. of Pages61
PDF Size4.5 MB

NCERT Solutions Class 11 Accountancy Chapter 4 Recording of Transactions 2

1. Briefly state how the cash book is both journal and a ledger?

Cash book functions as a journal because it is the original book of entry where all transactions are first recorded just like a journal and it functions as a ledger as it records the credit and debit cash transactions of a company without the need of a separate cash account.

2. What is the purpose of contra entry?

Contra entries are those entries that impact both the debit and credit side in accounting based on the situation.

For example, if a debit entry is recorded in an account, a similar credit entry must be recorded. Its purpose is to indicate transactions that affect both cash and bank balances.

These transactions have no impact on the financial position of the business and are denoted by the letter C in the L.F. column.

3. What are special purpose books?

Subsidiary books recording business transactions are known as special purpose books.

Business transactions can be large in number making it difficult to record all in a single journal.

Hence sub-dividing journals make the recording of transactions quick, accurate, and efficient. Some examples are cash books, purchases book, and sales book.

4. What is a petty cash book? How it is prepared?

Recording repetitive expenses in the cash book will burden the cashier. Hence, a separate book is created where petty expenses are recorded. Examples of such types of expenses are Stationery, Refreshment, Postage, and Conveyance. The petty cash book is maintained by the Petty cashier.

Preparation is mostly done by Imprest System as it is more convenient. In this system, the petty cashier is given a pre-defined sum of money for a period. At the end of the period, the amount spent by him is reimbursed by the cashier so that the cashier has the same amount again at the start of the period.

5. Explain the meaning of posting of journal entries?

It refers to the process of transferring journal entries to their respective ledgers. Each transaction gets recorded in a journal and is subsequently transferred to respective ledgers.

Recording Of Transactions Part 1 NCERT PDF

NCERT Class 11 Accountancy Textbook Chapter 4 Recording of Transactions With Answer PDF Free Download

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