PRC-1 · Chapter 2 · Question 25 of 100
'Metro Traders' paid its monthly electricity bill of Rs. 45,000 using an online bank transfer. How is this recorded in a two-column cash book?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Credit the bank column
Explanation
Payments made via bank transfer reduce the bank balance. Therefore, the transaction is recorded on the payment (credit) side of the cash book specifically in the bank column.
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