StudyTunnel Logo
StudyTunnel
by BhamuIntelli Systems LLP

Home

School

CBSE

Class 11 Commerce

Accountancy

Recording of Transactions - II

Recording of Transactions - II

Action PlanNotesQuestionsMock-Test
Study Action Plan (Sorted by Difficulty)
Double Column Cash Book
Accuracy: 56%
Total Attempted9
Total Correct5
Total Incorrect4
Difficulty Level:
Medium
Purchases Journal
Accuracy: 56%
Total Attempted9
Total Correct5
Total Incorrect4
Difficulty Level:
Medium
Sales Journal
Accuracy: 58%
Total Attempted12
Total Correct7
Total Incorrect5
Difficulty Level:
Medium
Petty Cash Book
Accuracy: 67%
Total Attempted6
Total Correct4
Total Incorrect2
Difficulty Level:
Medium
Cash Book
Accuracy: 83%
Total Attempted6
Total Correct5
Total Incorrect1
Difficulty Level:
Low
Special Purpose Journals
Accuracy: 83%
Total Attempted6
Total Correct5
Total Incorrect1
Difficulty Level:
Low
Purchases Return Journal
Accuracy: 100%
Total Attempted3
Total Correct3
Total Incorrect0
Difficulty Level:
Low
Sales Return Journal
Accuracy: 100%
Total Attempted3
Total Correct3
Total Incorrect0
Difficulty Level:
Low

Learning Objectives

Top

Learning Objectives

  • State the need for special purpose books.
  • Record the transactions in cash book and post them in the ledger.
  • Prepare the petty cash book.
  • Record the transactions in the special purpose books.
  • Post the entries in the special purpose book and to the ledger.
  • Balance the ledger accounts.

Practice, Analyze & Improve

Dont just read—test your knowledge! Unlock the Student Workspace to take chapter tests and get instant performance insights.

Deep Analytics

Peer Comparison

Track Progress

Claim Free Account100% Free • No credit card required

Revision Notes & Summary

Top

Chapter Notes on Accountancy

Key Concepts

  • Cash Book: A book used to record all cash receipts and payments.
  • Journal: Basic book of original entry.
  • Petty Cash Book: A book used to record small cash payments.
  • Purchase Journal: A special journal in which only credit purchases are recorded.
  • Sales Journal: A special journal in which only credit sales are recorded.
  • Purchases Return Book: A book in which return of merchandise purchased is recorded.
  • Sales Return Book: A special book in which returns of merchandise sold on credit are recorded.

Important Terms

  • Contra Entry: Transaction recorded both on debit and credit side of cash book.
  • Balancing of Account: Means total of debit and credit side.
  • Posting: The process of transferring entries from the journal to the ledger.

Special Purpose Books

  1. Cash Book: Records all cash transactions.
  2. Purchases Book: Records all credit purchases.
  3. Sales Book: Records all credit sales.
  4. Purchases Return Book: Records returns of purchased goods.
  5. Sales Return Book: Records returns of sold goods.
  6. Journal Proper: Records transactions that do not fit into special journals.

Examples of Transactions

  • Debit Note: Document evidencing a debit to be raised against a party for reasons other than sale on credit.
  • Credit Note: Prepared when a party is to be given a credit for reasons other than credit purchase.

Cash Book Entries

  • Bank Column: Balanced similarly to the cash column; can show credit balance due to overdraft.
  • Contra Entries: When cash is withdrawn from the bank or deposited, it is recorded in both cash and bank columns.

Common Questions for Practice

  1. What is the purpose of contra entry?
  2. Explain the need for drawing up the special purpose books.
  3. What is cash book? Explain the types of cash book.
  4. Define the purpose of maintaining subsidiary journal.
  5. What do you understand by ledger folio?

Checklist for Understanding

  • Fill in the correct words and state whether statements are true or false regarding cash book and journals.
Do you belong in the Top 10%?

Our analytics show that most students struggle with specific concepts in Recording of Transactions - II. Take a free diagnostic test to generate your personal Learning DNA profile.

Practice Test – MCQs, True/False

Top

Multiple Choice Questions

A.

Credit note

B.

Debit note

C.

Invoice

D.

Receipt
Correct Answer: B

Solution:

A debit note is generally used as the source document for recording entries in the Purchases Return Journal.

Chapter Concept:

Purchases Return Journal

A.

To record transactions between cash and bank

B.

To adjust errors in cash transactions

C.

To record credit sales

D.

To track petty cash disbursements
Correct Answer: A

Solution:

Contra entries in a double column cash book are used to record transactions that involve both cash and bank accounts, such as cash deposited into the bank or withdrawn from the bank.

Chapter Concept:

Double Column Cash Book

A.

Invoice

B.

Credit Note

C.

Debit Note

D.

Receipt
Correct Answer: B

Solution:

A credit note is prepared when goods are returned by customers, and it serves as the source document for the Sales Return Journal.

Chapter Concept:

Sales Return Journal

A.

Cash purchase of office furniture

B.

Credit purchase of goods for resale

C.

Cash sales of merchandise

D.

Credit sales of office equipment
Correct Answer: B

Solution:

The purchases journal is used to record all credit purchases of goods intended for resale.

Chapter Concept:

Special Purpose Journals

A.

It helps in recording cash purchases.

B.

It simplifies the process of returning defective goods to suppliers.

C.

It records all sales returns from customers.

D.

It tracks the depreciation of assets.
Correct Answer: B

Solution:

The purchases return journal is used to record the return of goods to suppliers, often due to defects or incorrect deliveries.

Chapter Concept:

Special Purpose Journals

A.

To record returns of goods purchased.

B.

To record returns of goods sold.

C.

To record cash sales.

D.

To record credit purchases.
Correct Answer: B

Solution:

The Sales Return Journal is used for recording returns of sold goods, typically due to defects.

Chapter Concept:

Sales Return Journal

A.

It is used to record all major business transactions.

B.

It operates on an imprest system to manage small, frequent expenses.

C.

It replaces the main cash book for all transactions.

D.

It is used to record credit sales transactions.
Correct Answer: B

Solution:

The petty cash book operates on an imprest system to manage small, frequent expenses, reducing the burden on the main cash book.

Chapter Concept:

Petty Cash Book

A.

Debit the cash column and credit the bank column

B.

Credit the cash column and debit the bank column

C.

Debit the bank column

D.

Credit the bank column
Correct Answer: D

Solution:

Bank charges are recorded as a credit in the bank column, as they represent an expense that reduces the bank balance.

Chapter Concept:

Double Column Cash Book

A.

It has a single column for all transactions.

B.

It includes multiple columns for different types of expenses, such as postage, conveyance, and miscellaneous.

C.

It only records cash receipts.

D.

It is structured the same as the main cash book.
Correct Answer: B

Solution:

The petty cash book includes multiple columns for different types of expenses, such as postage, conveyance, and miscellaneous, to facilitate easy recording and analysis.

Chapter Concept:

Petty Cash Book

A.

It will show a debit balance

B.

It will show a credit balance

C.

It will have no effect on the balance

D.

It will require a separate ledger entry
Correct Answer: B

Solution:

An overdraft results in a credit balance in the bank column, as it indicates that the withdrawals have exceeded the deposits.

Chapter Concept:

Double Column Cash Book

Experience the StudyTunnel Method

We do not just give you mock tests. We guide you through a gamified, AI-driven learning path designed to guarantee mastery.

Step 1: Practicing the Concepts

Recording of Transactions - II

Step 2: Master Boss Exam
Locked • Full Phase Assessment
Step 3: Redemption Arena
Locked • AI Weakness Tracker

True or False

Correct Answer: True

Solution:

The Sales Return Journal is specifically designed to handle the recording of goods returned by customers, typically when the goods were initially sold on credit.

Chapter Concept :

Sales Return Journal

Correct Answer: True

Solution:

The Purchases Return Journal is specifically used to record returns of purchased goods, and it utilizes debit notes as the source documents for these transactions.

Chapter Concept :

Purchases Return Journal

Correct Answer: True

Solution:

The sales journal captures all credit sales transactions using sales invoices as source documents, which aids in managing accounts receivable.

Chapter Concept :

Sales Journal

Correct Answer: False

Solution:

Contra entries in a cash book are not posted to the ledger because they represent internal transfers between cash and bank accounts.

Chapter Concept :

Cash Book

Correct Answer: False

Solution:

The petty cash book is used to manage small, frequent expenses, not large, infrequent ones. It operates on an imprest system to simplify recording minor transactions.

Chapter Concept :

Petty Cash Book

Correct Answer: True

Solution:

The double column cash book includes columns for both cash and bank transactions, allowing for detailed tracking of financial activities, including contra entries for transactions between cash and bank.

Chapter Concept :

Double Column Cash Book

Correct Answer: False

Solution:

The Purchases Journal records only credit purchases of goods, excluding cash purchases.

Chapter Concept :

Purchases Journal

Correct Answer: True

Solution:

The Purchases Journal is specifically used to record all credit purchases of goods, while cash purchases are recorded in the Cash Book.

Chapter Concept :

Purchases Journal

Correct Answer: False

Solution:

Contra entries in a double column cash book are not posted to the ledger. They are recorded in the cash book itself to reflect transactions between cash and bank.

Chapter Concept :

Double Column Cash Book

Correct Answer: True

Solution:

The cash book records all cash transactions and serves as both a journal and a ledger, eliminating the need for separate cash accounts in the ledger.

Chapter Concept :

Cash Book

AI Learning Assistant
Top

I can help you understand Recording of Transactions - II better. Ask me anything!

Summarize the main points of Recording of Transactions - II.
What are the most important terms to remember here?
Explain this concept like I'm five.
Give me a quick 3-question practice quiz.
StudyTunnel Methodology

We dont just provide random mock tests. Our AI-driven, phase-wise learning system is designed to guarantee mastery from your first chapter to your final exam.

1
Master the Concepts

Start with chapter notes, formulas, and common exam mistakes. Practice with thousands of MCQs, True/False, and Descriptive questions with instant solutions.

2
Conquer Boss Exams

Once you master individual chapters, unlock Phase-wise Boss Exams. These milestone tests simulate the actual exam environment to test your retention across multiple subjects.

3
The Redemption Arena

The ultimate learning hack. Our AI tracks every mistake you make and dynamically generates custom tests targeting your weak points until you achieve 100% accuracy.