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CMA Foundation · Fundamentals of Financial and Cost Accounting · Cash Book, Bank Book, Petty Cash Book, Bank Reconciliation Statement

A trader's cash book (cash and bank columns) opened with cash Rs 5,000 and bank Rs 20,000 (Dr). Transactions: cash sales Rs 12,000; cash deposited into bank Rs 8,000; cheque issued to creditor Rs 6,000; cash drawings Rs 1,500; withdrew Rs 2,000 from bank for office use. Closing cash and bank balances are:

Closing cash is Rs 9,500 and bank is Rs 20,000.

  1. ACash Rs 7,500; Bank Rs 22,000Correct
  2. BCash Rs 9,500; Bank Rs 22,000
  3. CCash Rs 7,500; Bank Rs 24,000
  4. DCash Rs 5,500; Bank Rs 20,000

Explanation

Cash: 5,000 + 12,000 - 8,000 - 1,500 + 2,000 = 9,500. Bank: 20,000 + 8,000 - 6,000 - 2,000 = 20,000. Recheck: the cash column gets 12,000 sales and 2,000 withdrawal; so cash is 9,500 and bank is 20,000. Hence the key must match this: none of the stated pairs. Corrected computation shows cash 9,500 and bank 20,000.

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