PRC-1 · Chapter 2 · Question 83 of 100
'Pinnacle Enterprises' transferred Rs. 100,000 from its bank account to top up the office cash safe. How is this 'contra entry' represented in the cash book?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Debit Cash, Credit Bank
Explanation
Money is leaving the bank, so it is a payment (Credit Bank). Money is entering the physical cash tin, so it is a receipt (Debit Cash). Both sides of the transaction stay within the cash book.
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