These eleven questions cover the skills in cash books and petty cash: choosing columns and sides, settlement discounts, contra entries, the imprest system and bank timing. All businesses and figures are fictional, and every amount is in RM.
Write your answer on paper first, with the columns ruled out, then open the worked answer. Check the method as well as the final balance. The percentage-base explorer helps with the discount calculations, and the double-entry and ledger trainer lets you check the ledger side.
Questions
1. State the column (cash or bank) and side (debit or credit) for each: (a) a customer pays RM 120 in notes; (b) a supplier is paid RM 300 by cheque; (c) the bank charges RM 15; (d) a customer pays RM 80 by card.
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(a) Cash, debit. Notes entered the till. (b) Bank, credit. A cheque leaves through the bank. (c) Bank, credit. Charges reduce the bank balance. (d) Bank, debit. Card payments reach the bank account, not the till.
2. Sari Stationery pays RM 210 wages in cash and receives RM 290 cash sales. Where does each go, and what is the net change in the cash column?
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Wages are a cash credit of 210. Sales are a cash debit of 290. Net change: 290 − 210 = RM 80 increase.
3. A customer owes RM 640. He pays by cheque and is allowed a 2.5% settlement discount. Find the discount and the cheque amount, and state the entries.
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Discount: 640 × 2.5% = 640 × 0.025 = RM 16. Cheque: 640 − 16 = RM 624. Entries: bank debit 624 and discount allowed 16 on the debit side. The customer’s account is credited RM 640.
4. Lim Trading is owed RM 1,250 by your business. You pay by cheque and receive a 4% discount. Find the cheque amount and state the entries.
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Discount: 1,250 × 4% = 1,250 × 0.04 = RM 50. Cheque: 1,250 − 50 = RM 1,200. Entries: bank credit 1,200 and discount received 50 on the credit side. The supplier’s account is debited RM 1,250.
5. A business banks RM 900 of cash takings on Monday, and withdraws RM 250 from the bank for petty cash on Wednesday. Write the contra entries.
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Monday: debit bank 900, credit cash 900, folio C. Wednesday: debit cash 250, credit bank 250, folio C. No ledger postings follow, because both parts are in the cash book.
6. Write up and balance a three-column cash book: Opening balances: cash RM 280, bank RM 1,500. (1) Cash sales RM 640. (2) Cheque received from a customer RM 900, settling RM 930, discount allowed RM 30. (3) Wages paid in cash RM 320. (4) Cheque paid to a supplier RM 1,100, settling RM 1,155, discount received RM 55. (5) Cash of RM 500 banked.
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Debit side: cash 280 + 640 = 920. Bank 1,500 + 900 + 500 (contra) = 2,900. Discount allowed: 30. Credit side: cash 500 (contra) + 320 = 820, balance c/d 100, total 920. Bank 1,100, balance c/d 1,800, total 2,900. Discount received: 55.
| Cash Dr | Bank Dr | Cash Cr | Bank Cr | |
|---|---|---|---|---|
| Balances b/d | 280 | 1,500 | ||
| Sales | 640 | |||
| Customer | 900 | |||
| Cash banked (C) | 500 | 500 | ||
| Wages | 320 | |||
| Supplier | 1,100 | |||
| Balance c/d | 100 | 1,800 | ||
| Totals | 920 | 2,900 | 920 | 2,900 |
Check: starting total 1,780, add sales 640 and customer 900, subtract wages 320 and supplier 1,100: 1,780 + 1,540 − 1,420 = 1,900. Closing balances 100 + 1,800 = 1,900. ✓
7. Teratai Clinic has a petty cash float of RM 150. During the month it pays: RM 12, RM 28, RM 35, RM 18 and RM 22. How much is spent, how much cash is left, and what is the restoring amount?
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Spent: 12 + 28 + 35 + 18 + 22 = RM 115. Check in a different order: 35 + 28 = 63, 63 + 22 = 85, 85 + 18 = 103, 103 + 12 = 115. ✓ Cash left: 150 − 115 = RM 35. Restoring amount: RM 115.
8. The imprest is RM 200. At the end of the month, the cash count is RM 64. How much should be restored, and what will the petty cash balance be afterwards?
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Spent: 200 − 64 = 136, so restore RM 136. Afterwards: 64 + 136 = RM 200, equal to the imprest.
9. A petty cash book shows a total column of RM 168. The analysis columns are travel RM 54 and postage RM 41, and sundry is missing. Find the sundry total and explain the check.
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168 − 54 − 41 = RM 73. The check is the cross-cast: 54 + 41 + 73 = 168, equal to the total column.
10. Nusa Hardware’s cash book shows a bank balance of RM 3,050. The bank statement shows RM 3,400. The only differences are an unpresented cheque for RM 500 and an uncleared deposit of RM 150. Show that the two records agree, and say whether any cash book entry is needed.
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Adjust the statement: 3,400 − 500 = 2,900. Then 2,900 + 150 = RM 3,050. This equals the cash book, so the records agree. No cash book entry is needed. Both items are already in the cash book. They are timing differences.
11. A cash book bank balance is RM 2,000. The statement shows a direct debit of RM 35 and bank interest received of RM 10, neither in the cash book. Find the updated balance.
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Direct debit is a bank credit: 2,000 − 35 = 1,965. Interest is a bank debit: 1,965 + 10 = RM 1,975. Check: net effect −35 + 10 = −25, and 2,000 − 25 = 1,975. ✓
If you got these wrong
- Wrong column or side (questions 1 and 2): revisit distinguishing bank and cash movements.
- Discount in the wrong place, or wrong amount (3, 4 and 6): review entering receipts and payments with correct columns.
- Contra entries (5 and 6): go to recording a contra entry.
- Petty cash (7, 8 and 9): study restoring a petty-cash imprest.
- Bank timing (10 and 11): read comparing cash-book balance with bank statement timing.
Add each slip to the mistake log and retest queue, then retest it on a new question after a few days.
If the same error keeps returning across different questions, online one-to-one Accounting tuition gives you a teacher who can watch your working and spot the pattern as it happens.