Subsidiary Books

Question 1

What are Subsidiary Books?

Answer 1

Subdivision of journals on the basis of nature of transactions is known as Subsidiary Books.

Question 2

What is a Cash Book?

Answer 2

The subsidiary book in which details of cash are received in the form of cash, cheques, drafts, etc., and details of payment made in the form of cash, cheques, drafts, etc. is called a cash book.

Question 3

State the meaning of ‘Contra entry’.

Answer 3

The accounting entries which appear on both the sides of cash book are called contra entries.

Question 4

State the meaning of the imprest system of Petty Cash Book.

Answer 4

Imprest System of Petty cash book is a system in which head cashier gives fixed (imprest) amount to the petty cashier at the beginning of month/fortnight to meet the expenses of that period. Later on the shortfall after meeting the expenses is reimbursed by the head cashier.

Question 5

Which transactions are recorded in Purchase Book?

Answer 5

Goods purchased on credit for resale are only recorded in the Purchase Book.

Question 6

Which sales are recorded in Sales Book?

Answer 6

Credit sales of goods are recorded in Sales Book.

Question 7

Which transactions are recorded in the Journal Proper?

Answer 7

Journal Proper is meant for recording opening entries, closing entries, adjustment entries, transfer entries, and rectification entries.

Question 8

Who is a Petty Cashier?

Answer 8

A cashier in charge of recording transactions in a petty cash book is known as Petty Cashier.

Question 9

A bank account which the businessman prefers to open.

Answer 9

Current Account

Question 10

Petty Cash Book in which the payment side is ruled in suitable columns.

Answer 10

Analytical Petty Cash Book

Question 11

Subsidiary book in which only credit purchases of goods are recorded.

Answer 11

Purchase Book

Question 12

Subsidiary book in which return of goods sold on credit is recorded.

Answer 12

Sales Return Book

Question 13

The entry is recorded on both sides of the cash book.

Answer 13

Contra Entry

Question 14

Name the account which encourages personal savings.

Answer 14

Saving Account

Question 15

A note was issued by the buyer to the seller giving full details of goods returned.

Answer 15

Debit Note

Question 16

A note was issued by the seller on receipt of defective goods from the customer.

Answer 16

Credit Note

Question 17

Name the bank account on which overdraft facility is given to the Account holder.

Answer 17

Current Account

Question 18

Cash column of Cash Book can never have ____________ balance.

Answer 18

credit

Question 19

Any entry recorded on both sides of Cash Book is known as ____________ entry.

Answer 19

contra

Question 20

The source document for recording in Sales book is ____________

Answer 20

Outward Invoice

Question 21

Credit purchase of Machinery is recorded in the ____________

Answer 21

Journal Proper

Question 22

Sub-division of journal is known as ____________ book.

Answer 22

Subsidiary

Question 23

Additional cash introduced in business is recorded in ____________

Answer 23

Cash Book

Question 24

Entry for bad debts is recorded in the ____________

Answer 24

Journal Proper

Question 25

Direct deposit made by the customer into our bank is recorded in the ____________ side of the Cash Book.

Answer 25

receipts

Question 26

The person who draws the cheque and signs on it is the ____________

Answer 26

drawer

Question 27

A fixed amount is deposited for a fixed period in ____________ deposit account.

Answer 27

Fixed

Question 28

Journal is a book of secondary entry.

Answer 28

This statement is False. Journal is a book of prime entry.

Question 29

Assets sold on credit are entered in Sales Journal.

Answer 29

This statement is False. Assets sold on credit are entered in Journal Proper.

Question 30

Cash and credit purchases are entered in Purchase Book.

Answer 30

This statement is False. Only credit purchases are entered in Purchase Book.

Question 31

Cash sales are entered in Sales Journal.

Answer 31

This statement is False. Cash sales are entered in the cash book.

Question 32

Cash Book records transactions relating to receipts and payments of cash.

Answer 32

This statement is True.