Overdraft receipt. Note an overdraft is an asset to the bank. Image credit consumerist.com

Overdraft receipt. Note an overdraft is an asset to the bank. Image credit consumerist.com

ZIMSEC O Level Principles of Accounts Notes: The Cash Book: Bank Overdraft example

  • Consider the following entries and enter into the books of J Mativure
  • You are only required to write up the Cash Book

The Following transactions took place in the month of July 20×7
1 Started the business with $5 000 Cash
3 Deposited $1200 into the Bank
4 Made Purchases of $600 and paid by Cheque
12 Made Cash Sales of $400
15 Sold goods on credit to J Musoro $300
22 Received Cheque from J Musoro $280 in full settlement of his account
30 Paid wages $1800 by cheque

NB No other transactions took place during the year

Solution

Cash Book
DetailsDiscount AllowedCash BankDetailsDiscount ReceivedCashBank
$ $ $ $
Capital5000Bank1200
Cash1200Purchases600
Sales400Wages1800
J Chimusoro20280Balance c/d4200
Balance c/d920

20

5400

2400

-

5400

2400

To access more topics go to the Principles of Accounts Notes.

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