Cash Book
All Four Types Explained
Master all four types of Cash Books — Simple, Double Column, Triple Column, and Petty Cash Book. Learn the format, ruling, balancing method, and special features like contra entries and imprest system. One of the highest-scoring practical chapters in Class 11.
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📌 Why Cash Book Is Critical
Book of Original Entry + Ledger Account — A Unique Dual Role
The Cash Book is unique because it serves as both a subsidiary book (book of original entry) and a Ledger account simultaneously. Every cash and bank transaction goes here first. No separate Cash Account or Bank Account is maintained in the Ledger when a Cash Book is in use. Master this chapter and you have mastered the most practical part of bookkeeping.
1. Meaning and Features of Cash Book
A Cash Book is a special purpose subsidiary book used to record all cash receipts and cash payments in chronological order. It is written in a T-format just like a Ledger account — receipts on the Dr. (left) side and payments on the Cr. (right) side.
Key Features: Records only cash and bank transactions | Dr. side = receipts (cash comes in) | Cr. side = payments (cash goes out) | Always shows a Debit balance or Nil balance (cash can never be negative) | Acts as both subsidiary book and Cash/Bank Ledger account
2. Types of Cash Book
1
Simple Cash Book (Single Column)
Records only cash transactions. One amount column on each side. Used by very small businesses with no bank account.
2
Double Column Cash Book
Two columns on each side — Cash and Discount. Records cash transactions plus discount allowed/received. Most common in practice.
3
Triple Column Cash Book
Three columns each side — Discount, Cash, Bank. Records cash, bank, and discount all in one book. Used by businesses with both cash and bank transactions.
4
Petty Cash Book
Records small day-to-day expenses (postage, tea, stationery). Maintained by a petty cashier under the Imprest System.
3. Simple Cash Book — Format and Example
The simplest form — one amount column on Dr. side (receipts) and one on Cr. side (payments). Only cash transactions are recorded.
📈 Simple Cash Book — M/s Sharma Traders, April 2026
Transactions: Apr 1 Opening balance ₹50,000 | Apr 3 Cash sales ₹40,000 | Apr 5 Rent paid ₹8,000 | Apr 8 Received from Ramesh ₹25,000 | Apr 12 Salary paid ₹15,000 | Apr 18 Purchases for cash ₹20,000
| Dr. Simple Cash Book Cr. | |||||||
| Date | Particulars | L.F. | Amount (₹) | Date | Particulars | L.F. | Amount (₹) |
|---|---|---|---|---|---|---|---|
| Apr 1 | To Balance b/d | 50,000 | Apr 5 | By Rent A/c | 8,000 | ||
| Apr 3 | To Sales A/c | 40,000 | Apr 12 | By Salary A/c | 15,000 | ||
| Apr 8 | To Ramesh A/c | 25,000 | Apr 18 | By Purchases A/c | 20,000 | ||
| Apr 30 | By Balance c/d | 72,000 | |||||
| Total | 1,15,000 | Total | 1,15,000 | ||||
| May 1 | To Balance b/d | 72,000 | |||||
Closing Balance ₹72,000 Dr. Dr. total ₹1,15,000 − Cr. payments ₹43,000 = ₹72,000. Cash Book always closes with a Debit balance (or nil). Written as "By Balance c/d" on Cr. side; reopens as "To Balance b/d" on Dr. side.
4. Double Column Cash Book (Cash + Discount)
Has two columns on each side — Discount and Cash. The Discount column records trade discount allowed to debtors (Dr. side) and discount received from creditors (Cr. side). The Discount columns are NOT balanced — they are just totalled and transferred to Discount Allowed A/c (Dr.) and Discount Received A/c (Cr.) in the Ledger.
Key rule for Discount column: Discount column is NEVER balanced. It is only totalled at period end. The total Discount Allowed is posted to the Dr. side of Discount Allowed A/c in Ledger. The total Discount Received is posted to the Cr. side of Discount Received A/c in Ledger.
📈 Double Column Cash Book — M/s Verma & Co., April 2026
Transactions: Apr 1 Balance ₹60,000 | Apr 4 Received from Suresh ₹19,500, discount allowed ₹500 | Apr 7 Cash sales ₹30,000 | Apr 10 Paid to Ramesh ₹29,000, discount received ₹1,000 | Apr 15 Rent paid ₹6,000
| Dr. Double Column Cash Book Cr. | |||||||||
| Date | Particulars | L.F. | Disc. (₹) | Cash (₹) | Date | Particulars | L.F. | Disc. (₹) | Cash (₹) |
|---|---|---|---|---|---|---|---|---|---|
| Apr 1 | To Balance b/d | — | 60,000 | Apr 10 | By Ramesh A/c | 1,000 | 29,000 | ||
| Apr 4 | To Suresh A/c | 500 | 19,500 | Apr 15 | By Rent A/c | — | 6,000 | ||
| Apr 7 | To Sales A/c | — | 30,000 | Apr 30 | By Balance c/d | — | 74,500 | ||
| Total | 500 | 1,09,500 | Total | 1,000 | 1,09,500 | ||||
| May 1 | To Balance b/d | 74,500 | |||||||
Discount column total Dr. ₹500 → posted as Discount Allowed A/c Dr ₹500 in Ledger. Discount column total Cr. ₹1,000 → posted as Discount Received A/c Cr ₹1,000 in Ledger. Cash column: Closing balance ₹74,500 Dr.
5. Triple Column Cash Book (Discount + Cash + Bank)
Has three columns on each side — Discount, Cash, and Bank. Replaces both the Cash Ledger account and the Bank Ledger account. The most comprehensive form of Cash Book.
Contra Entries — The Most Important Feature
A Contra Entry is an entry that appears on both sides of the Cash Book in the Cash and Bank columns. It occurs when money moves between Cash and Bank within the business. Marked with letter "C" in the L.F. column on both sides. No Ledger posting is done for contra entries.
Two Contra Situations:
1. Cash deposited into Bank → Dr. side: Bank column; Cr. side: Cash column. Both entries with "C" in L.F.
2. Cash withdrawn from Bank for office → Dr. side: Cash column; Cr. side: Bank column. Both entries with "C" in L.F.
1. Cash deposited into Bank → Dr. side: Bank column; Cr. side: Cash column. Both entries with "C" in L.F.
2. Cash withdrawn from Bank for office → Dr. side: Cash column; Cr. side: Bank column. Both entries with "C" in L.F.
📈 Triple Column Cash Book — M/s Gupta Enterprises, April 2026
Transactions: Apr 1 Cash ₹80,000; Bank ₹1,20,000 | Apr 3 Cash deposited to bank ₹30,000 (Contra) | Apr 5 Received cheque from Priya ₹49,000, discount allowed ₹1,000 | Apr 8 Cash withdrawn from bank for office ₹20,000 (Contra) | Apr 10 Paid rent by cheque ₹12,000 | Apr 15 Cash purchases ₹18,000 | Apr 20 Paid to Mohan by cheque ₹38,000, discount received ₹2,000
| Dr. Triple Column Cash Book Cr. | |||||||||||||
| Date | Particulars | L.F. | Disc. | Cash | Bank | Date | Particulars | L.F. | Disc. | Cash | Bank | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Apr 1 | To Balance b/d | — | 80,000 | 1,20,000 | Apr 3 | By Cash A/c (C) | C | — | 30,000 | — | |||
| Apr 3 | To Bank A/c (C) | C | — | — | 30,000 | Apr 10 | By Rent A/c | — | — | 12,000 | |||
| Apr 5 | To Priya A/c | 1,000 | — | 49,000 | Apr 15 | By Purchases A/c | — | 18,000 | — | ||||
| Apr 8 | To Bank A/c (C) | C | — | 20,000 | — | Apr 20 | By Mohan A/c | 2,000 | — | 38,000 | |||
| Apr 30 | By Balance c/d | — | 52,000 | 1,19,000 | |||||||||
| Total | 1,000 | 1,00,000 | 1,99,000 | Total | 2,000 | 1,00,000 | 1,99,000 | ||||||
| May 1 | To Balance b/d | 52,000 | 1,19,000 | ||||||||||
Contra entries (Apr 3 and Apr 8) appear on BOTH sides with "C" in L.F. column. They are NOT posted to Ledger. Cash closing balance ₹52,000 Dr. Bank closing balance ₹1,19,000 Dr.
6. Petty Cash Book — Imprest System
A Petty Cash Book is maintained by a Petty Cashier to record small, recurring day-to-day expenses like postage, tea, stationery, conveyance, etc. The Imprest System is the most common method.
Imprest System — How It Works
1
Fixed Float Given
Head cashier gives petty cashier a fixed amount at the start of each period (e.g., ₹5,000 per month). This is called the Imprest Amount.
2
Expenses Recorded
Petty cashier pays and records all small expenses under different heads (Postage, Stationery, Conveyance, Entertainment, Miscellaneous) during the period.
3
Reimbursement
At the end of the period, head cashier reimburses exactly the amount spent, bringing the balance back to the original Imprest Amount for the next period.
Imprest formula: Imprest Amount = Closing Balance + Total Expenses for the period
Reimbursement = Total expenses spent during the period (restores to Imprest Amount)
Example: Imprest ₹5,000 | Expenses ₹3,800 | Closing balance ₹1,200 | Reimbursement = ₹3,800
Reimbursement = Total expenses spent during the period (restores to Imprest Amount)
Example: Imprest ₹5,000 | Expenses ₹3,800 | Closing balance ₹1,200 | Reimbursement = ₹3,800
Petty Cash Book Format (Analytical / Columnar)
| Petty Cash Book — M/s Expert Traders (Imprest ₹5,000 per month) | ||||||||
| Receipts (₹) | Date | Particulars | Voucher No. | Total Payments (₹) | Postage (₹) | Stationery (₹) | Conveyance (₹) | Misc. (₹) |
|---|---|---|---|---|---|---|---|---|
| 5,000 | Apr 1 | To Cash (Imprest) | ||||||
| Apr 2 | By Postage stamps | 1 | 400 | 400 | ||||
| Apr 4 | By Stationery | 2 | 600 | 600 | ||||
| Apr 8 | By Auto fare | 3 | 350 | 350 | ||||
| Apr 12 | By Tea & snacks | 4 | 280 | 280 | ||||
| Apr 15 | By Courier charges | 5 | 520 | 520 | ||||
| Apr 20 | By Pen & notebook | 6 | 450 | 450 | ||||
| Apr 25 | By Taxi | 7 | 1,200 | 1,200 | ||||
| 5,000 | Total | 3,800 | 920 | 1,050 | 1,550 | 280 | ||
| 1,200 | Apr 30 | Balance c/d ₹1,200 | Reimbursement due = ₹3,800 | ||||||
| 3,800 | May 1 | To Cash — Reimbursement received (restores imprest to ₹5,000) | ||||||
Column totals: Postage ₹920 + Stationery ₹1,050 + Conveyance ₹1,550 + Misc. ₹280 = ₹3,800 total payments ✓. Each column total is posted separately to its Ledger account as a debit.
7. Cash Book vs Journal — Key Differences
| Basis | Cash Book | Journal |
|---|---|---|
| Nature | Special purpose subsidiary book + Ledger account | General purpose book of original entry |
| Transactions | Only cash and bank transactions | All transactions (cash, credit, adjustments) |
| Format | T-format with Dr. (receipts) and Cr. (payments) | 5-column tabular format |
| Balance | Always Dr. balance or nil (cash never negative) | Not balanced — just totalled |
| Narration | Not required | Compulsory for every entry |
| Posting to Ledger | Cash/Bank A/c posting not needed (Cash Book IS the Ledger) | Every entry posted to Ledger |
⚡ Quick Recall — Chapter 9 Key Points
Cash Book = Subsidiary book + Ledger account. Records only cash and bank transactions. Always Dr. balance (cash cannot be negative).
4 types: Simple (cash only) | Double Column (cash + discount) | Triple Column (discount + cash + bank) | Petty Cash Book.
Dr. side = Receipts (cash/bank comes in). Cr. side = Payments (cash/bank goes out). "To" on Dr. side, "By" on Cr. side.
Discount column is NEVER balanced — only totalled. Dr. total posted to Discount Allowed A/c; Cr. total to Discount Received A/c in Ledger.
Contra Entry: Cash deposited into bank OR cash withdrawn from bank for office. Appears on BOTH sides. "C" in L.F. column. NO Ledger posting.
Cash withdrawn for PERSONAL use → NOT a contra entry. Goes only on Cr. side of Cash column (Drawings A/c).
Imprest System: Fixed amount given to petty cashier at period start. Reimburse exact amount spent. Opening petty cash = always the Imprest Amount.
Petty Cash Book columns: Receipts | Date | Particulars | Voucher No. | Total Payments | Analysis columns (Postage, Stationery, Conveyance, etc.).
Bank overdraft = Cr. balance in Bank column (rare). Cash column can NEVER have a Cr. balance.
Discount Allowed = our loss (Dr. in Ledger). Discount Received = our gain (Cr. in Ledger). Never confuse these two.
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20 MCQs — Cash Book
Mixed difficulty — types, format, contra entries, discount columns, petty cash, and numericals. Q17–Q20 are CUET-level.
📚 Questions 1 to 20
1
The Cash Book is unique because it serves as:
AOnly a Ledger account
BOnly a subsidiary book
CBoth a subsidiary book of original entry and a Ledger account simultaneously
DA replacement for the Journal only
Answer: C. The Cash Book has a dual role — it is a book of original entry (transactions recorded here first) AND it acts as the Cash A/c and Bank A/c in the Ledger. No separate Cash or Bank Ledger account is maintained when a Cash Book is in use.
2
In the Cash Book, the Receipt side is always the:
ACredit (right) side
BDebit (left) side
CEither side depending on the transaction
DThe middle column
Answer: B — Debit (left) side. All receipts (cash/bank coming IN) are recorded on the Dr. (left) side. All payments (cash/bank going OUT) are on the Cr. (right) side. This mirrors the double-entry rule: Cash A/c Dr when cash comes in.
3
The Cash Book can NEVER show a Credit balance in the Cash column because:
AIt is a rule set by CBSE
BYou cannot pay out more cash than you have — cash in hand cannot be negative
CThe Cash Book is always balanced at zero
DOnly the Bank column can show Cr. balance
Answer: B. Cash in hand can never be negative — you cannot pay out more cash than you physically have. Therefore the Cash column always shows a Dr. balance or nil. The Bank column CAN show a Cr. balance (Bank Overdraft) when payments exceed the bank balance.
4
In a Double Column Cash Book, the Discount column on the Dr. side records:
ADiscount received from suppliers
BDiscount allowed to debtors (our loss)
CTrade discount on purchases
DCash discount on bank transactions
Answer: B — Discount Allowed to debtors. When we receive cash from a debtor and allow him a discount, the full amount he owed goes on the Dr. side — cash received in Cash column, discount allowed in Discount column. Discount Received (from creditors) goes on the Cr. side Discount column.
5
The Discount column in the Cash Book is:
ABalanced like the Cash column
BNot recorded at all
CNot balanced — only totalled and then posted to the Ledger
DBalanced and carried forward as Balance b/d
Answer: C. The Discount column is NEVER balanced. It is totalled at period end. Dr. total → Discount Allowed A/c Dr. in Ledger. Cr. total → Discount Received A/c Cr. in Ledger. Only the Cash and Bank columns are balanced.
6
A Contra Entry in a Triple Column Cash Book appears when:
ACash is paid to a creditor
BCash is deposited into bank OR cash is withdrawn from bank for office use
CA cheque is received from a debtor
DGoods are purchased for cash
Answer: B. Contra entries occur only when money moves between Cash and Bank within the business. Cash deposit: Dr. Bank column, Cr. Cash column. Cash withdrawal for office: Dr. Cash column, Cr. Bank column. Both sides marked "C" in L.F. column. No Ledger posting required.
7
Cash withdrawn from bank by owner for PERSONAL use in a Triple Column Cash Book is:
AA Contra Entry — Dr. Cash, Cr. Bank
BNOT a Contra Entry — only Cr. side Bank column (Drawings A/c)
CRecorded on Dr. side only
DNot recorded in Cash Book
Answer: B — NOT a Contra Entry. Personal withdrawal involves Drawings A/c (a third account) — not just Cash and Bank. Entry: only on Cr. side of Bank column (Bank goes out). Drawings A/c Dr. is posted to Ledger separately. Contra entries involve ONLY Cash and Bank, nothing else.
8
Received ₹9,700 from Sunil in full settlement of ₹10,000. In Double Column Cash Book Dr. side entry is:
ACash ₹10,000; Discount ₹0
BCash ₹9,700; Discount ₹9,700
CCash ₹9,700; Discount ₹300
DCash ₹10,000; Discount ₹300
Answer: C. Cash received ₹9,700 goes in Cash column Dr. Discount allowed ₹300 (₹10,000 − ₹9,700) goes in Discount column Dr. Total Dr. side = ₹10,000 (= what Sunil owed). Sunil A/c is credited ₹10,000 in Ledger.
9
Paid to Ramesh ₹18,500 by cheque in full settlement of ₹20,000. In Triple Column Cash Book Cr. side entry is:
ABank ₹20,000; Discount ₹0
BBank ₹18,500; Discount ₹1,500
CCash ₹18,500; Discount ₹1,500
DBank ₹20,000; Discount ₹1,500
Answer: B. Cheque paid ₹18,500 → Bank column Cr. ₹18,500. Discount received ₹1,500 → Discount column Cr. ₹1,500. Ramesh A/c is debited ₹20,000 in Ledger. Payment is by cheque → Bank column (not Cash column).
10
The Imprest System of Petty Cash means:
APetty cashier receives cash only when he needs it
BA fixed amount is given at the start of each period; at period end the exact amount spent is reimbursed to restore the original float
CPetty cashier keeps all cash received from customers
DExpenses are paid directly by the main cashier without a petty cashier
Answer: B. Under the Imprest System, the petty cashier gets a fixed float (Imprest Amount) at the start. At period end, the head cashier reimburses exactly the amount spent — bringing the balance back to the Imprest Amount. This makes it easy to verify and control petty expenses.
11
Imprest Amount ₹4,000. Expenses paid during month ₹3,200. Closing balance and reimbursement are:
AClosing ₹4,000; Reimbursement ₹4,000
BClosing ₹800; Reimbursement ₹3,200
CClosing ₹3,200; Reimbursement ₹800
DClosing ₹7,200; Reimbursement ₹0
Answer: B. Closing balance = Imprest − Expenses = ₹4,000 − ₹3,200 = ₹800. Reimbursement = amount spent = ₹3,200 (to restore balance to ₹4,000). Key: Reimbursement always equals total expenses paid during the period.
12
Which of the following is NOT recorded in the Cash Book?
ACash sales
BSalary paid in cash
CCredit purchase from Ramesh
DCash deposited into bank
Answer: C — Credit purchase. Credit purchase involves no cash or bank movement — it goes in the Purchase Book (not Cash Book). The Cash Book records ONLY transactions where cash or cheque is actually received or paid. Credit transactions go to other subsidiary books or the Journal.
13
A cheque received from a debtor and deposited on the same day in a Triple Column Cash Book is recorded:
AOn Dr. side Cash column only
BOn Dr. side Bank column only
COn both sides as a Contra Entry
DNot in Cash Book — in Journal only
Answer: B — Dr. side Bank column only. A cheque received and deposited same day goes directly to Bank column Dr. (one entry only). It is NOT a Contra Entry because no Cash column is involved — the cheque never passed through the cash box. Only cash-to-bank or bank-to-cash movements are Contra Entries.
14
In a Triple Column Cash Book, "C" written in the L.F. column indicates:
ACash transaction
BCredit transaction
CContra Entry — no Ledger posting required
DCheque transaction
Answer: C — Contra Entry. "C" in the L.F. column of both sides of a Contra Entry means no Ledger posting is required. Since Cash A/c and Bank A/c are already part of the Cash Book, posting contra entries would create double-counting.
15
The Bank column of a Triple Column Cash Book can show a Credit balance. This means:
AAn error has occurred
BCash is negative
CBank Overdraft — payments from bank exceeded deposits
DThe business has excess cash
Answer: C — Bank Overdraft. A Cr. balance in the Bank column means the business has overdrawn its bank account — it has taken more money out than it put in. This is a Bank Overdraft and is treated as a liability. The Cash column can NEVER show a Cr. balance.
16
Discount Received total in Cash Book is posted to Ledger as:
ADiscount Received A/c Dr.
BDiscount Allowed A/c Cr.
CDiscount Received A/c Cr.
DCash A/c Dr.
Answer: C — Discount Received A/c Cr. Discount Received is our income (we paid less to the creditor than we owed). Income is credited in the Ledger. The Cr. side Discount column total is posted as: Discount Received A/c Cr. in the Ledger.
17
CUET: Opening cash balance ₹45,000. Cash receipts during month: Sales ₹60,000; Received from debtors ₹30,000. Cash payments: Purchases ₹25,000; Salary ₹18,000; Rent ₹9,000; Deposited in bank ₹40,000. Closing cash balance is:
A₹83,000
B₹53,000
C₹43,000
D₹3,000
Answer: C — ₹43,000. Dr. side: Opening ₹45,000 + Sales ₹60,000 + Debtors ₹30,000 = ₹1,35,000. Cr. side: Purchases ₹25,000 + Salary ₹18,000 + Rent ₹9,000 + Bank deposit ₹40,000 = ₹92,000. Closing balance = ₹1,35,000 − ₹92,000 = ₹43,000 Dr.
18
CUET: Assertion (A): Cash deposited into bank and cash withdrawn from bank for office use are both Contra Entries. Reason (R): In both cases only Cash A/c and Bank A/c are involved — both are part of the Cash Book, so no Ledger posting is needed.
ABoth A and R are true, and R correctly explains A
BBoth A and R are true, but R does not explain A
CA is true; R is false
DA is false; R is true
Answer: A — Both true and R correctly explains A. Both cash deposit and office withdrawal are Contra Entries (A is correct). The reason: since Cash A/c and Bank A/c are maintained within the Cash Book itself, posting contra entries to the Ledger would be double-counting — hence no Ledger posting (R is correct and explains A).
19
CUET: Petty Cash Imprest ₹6,000. Expenses paid: Postage ₹800; Stationery ₹1,200; Conveyance ₹1,500; Miscellaneous ₹900. Closing balance and amount reimbursed are:
AClosing ₹6,000; Reimbursement ₹6,000
BClosing ₹4,400; Reimbursement ₹1,600
CClosing ₹1,600; Reimbursement ₹4,400
DClosing ₹2,600; Reimbursement ₹3,400
Answer: C. Total expenses = ₹800 + ₹1,200 + ₹1,500 + ₹900 = ₹4,400. Closing balance = ₹6,000 − ₹4,400 = ₹1,600. Reimbursement = total expenses = ₹4,400 (to restore imprest to ₹6,000). Column total check: ₹800 + ₹1,200 + ₹1,500 + ₹900 = ₹4,400 ✓
20
CUET: In a Triple Column Cash Book, a cheque received from debtor Anil ₹25,000 is kept in hand for 3 days before depositing. How many entries are made?
AOne entry — Dr. Bank column on date of receipt
BTwo entries — Dr. Cash column on receipt date; then Contra Entry when deposited
COne entry — Dr. Cash column on deposit date
DNo entry in Cash Book — only Journal entry
Answer: B — Two entries. When a cheque is received but NOT deposited same day: Entry 1 on receipt date → Dr. Cash column (cheque treated as cash). Entry 2 when deposited → Contra Entry: Dr. Bank column, Cr. Cash column. If deposited same day → only one entry in Bank column Dr.
Chapter 9 — Live Quiz
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