LEARNING OBJECTIVES Bee oce ‘dents to understand. Meaning of Voucher Types of Vouchers > Source Vouchers or Sy > Accounting Vouchers Po" tn"9 Vouchers Preparation of Vouchers Transactions re recorded in the ils of purchase, invoices for the basis of recordin, are applied to ea books of account on the ba, le, debit and credit notes, ex. ‘The 8 entry, are known, asS ach transaction and her lsproseen eee sis of evidences which are evidences being ules of debit and credit ‘voucher is prepared bet ot eriginal entry, ie aoneion 2 pared before recordingit in the beee r » Journal or Special Purpere nt s entries recorded in these books of accou gene PoOkS in a chronological ender The SsPunt are transferred to the specific Ledger accrany In this chapter, Source Documents and Vouchers shall be discussed. Utes lela ard | An evidence of a transaction or an event. Source document is an evidence of transaction or event having taken place. It is of Prime importance in accounting because accounting is based on factual finaniny information, ie., evidence. For example, a cash memo showing cash sales, an ineeie showing sales of goods on credit, bills of purchases showing purchases of goods on . credit, a receipt made out by the receiver for cash received, ete. These documents are Source Documents and evidence in support of a transaction. They are also sometimes called supporting documents. Let us now discuss the most common source documents. 1. Cash Memo w is ar inst cash. Tt has details Cash Memo is prepared by the seller when Bods are sold ngs act a of goods sold, quantity, rate of enc item and the total amount resived, besten the date of transaction and other terms and eonditons, if any. It isan evidence fo the purchaser for, goods purchased against cash, and fo , sales for cash,” Double Entry Boog, A specimen of a Cash Memo is as follows: CASH MEMO CHMADRA SILK & SAREES Wholesale and Retail Wedding Saree Specialists ‘CTC Plata fing Road, Maharani Bagh, New Delhi, 110.065 (Rupees Fourteen Thousand Only) Geers once sold wil not be taken back 2. Invoice or Bill ‘An Invoice or Bill is prepared by the seller when the goods are sold on credi details of the party to whom goods are sold, goods sold and the total gajy "Ith, Nice is any ‘The original copy of the sales invoice is sent to the purchaser and a duplicay, ™*" retained as an evidence ofthe sales for recording i in the books of account. future reference. For the purchaser, credit purchases are evidenced by bij} »\"*!y from the supplier. A specimen of a Invoice or a Bill is as follows: ei INVOICE [penn eecrmesureuieRsitD. Dealersin venting Electrical 131, Nowhere Street, Delhi 110001 | ea Coster Everard Fine Cy, Mee UP ‘Quantty] Particulars Rate ®) ‘Amount ) 2 | Refrigerators (167 ) 8,000 16000 10 | Auomatic ons 1100 ow Total [7700 Rapes Twenty Seen Taand Ory aoe tap| 3. Receipt When cash or cheque is received from a customer, a receipt for the amount receivet 4 issued. The receipt is prepared in duplicate. The original copy is given to the pat ‘making the payment and the duplicate is kept for record. [thas details of date, amount. name of the party and the nature of the payment.nag of Tromunctions et and Preparation of Voucher m ” a apecimen of 0 ROCHE ie H8 fll San el yo. 19137 th thanks Petter am M/s Adal Catomer, Fine City ieee, Teeny Sen Thousand only r CabvcneaueNe, S591 dated 52.204 demon awn on enaccountofimvoiceNo, sory —dated _3.2.2022 Note: Cheques ae subject to realisation, 4. Pa: Itis @ source document used for dey a form available from a bank. It hay Now-a-days, banks place can be dropped, In such, -Slip ;ositing cash or cheques into bank. Pay-in-Slip is a bon nn) Counterfoil which is retained by the depositor. box in whic cheques along with the filled pay-in-slips nses, counterfoils are not signed. ‘The counterfoi pay:in-slip gives details regarding the date and Mba otisaeeee horchen depen A specimen of a Pay-in-Slip is as follows: acre eed: ‘arson. || Amseankiro, tahiti moe iauneramsinc | ecco, COO TT ome CITCCTEIECLITT ; [ORStEeeRumern. = — DEWARS OF CABUCHEQUE | _— seni — Fegan —- 5. Cheque Cheque is a document in writing, drawn upon the bank with which the account is held and is payable on or after the due date. The bank supplies the cheque forms, The name of the party to whom payment is to be made is written after the words ‘Pay ‘To’. Then the amount is written—both in words and figures. A cheque is dated and signed by the drawer. The cheque details are entered on the counterfoil which remains with the account holder and is the source voucher for recording the transaction in the books of account.4 A specimen of a Cheque is as follows: CHEQUE | 6. Debit Note debit has been made to the account of the pan named in the debit note It details the reason forthe debit. For example, a seller of goods ‘make a debit note ifhe finds that invoiced for less amount. Similar}, a purchaser of goods will make a debit note i the goods have been over-invoiced or he ha; returned the goods or the seller has allowed a lower discount, etc. ‘The effect of a debit no, that amount due tothe suppliers reduced othe ‘account is already settled, goods cay te purchased further without payment. A specimen of a Debit Note is given below: DEBIT NOTE PROVOGUE 117, Kalkaj, New Delhi 110019 No.2is DEBIT NOTE ‘Against M/s. High & Low, New Delhi Goods returned as per delivery Callan No, 93 (Rupees Five Thousand Five Hundred Oni) 7. Credit Note Credit Note is made out evidencing that credit has been granted to a debtor. For ae veturns goods previously invoiced, oF the customer is allo further discount, a credit note is issued. The effect of edit note is that the mit of the customer's indebtedness is reduced or, if it is already settled, to enable th customer to purchase goods tothe value ofredit without further payment. A specie of a Credit Note is as follows: example, if a ct CREDIT NOTE "ASHIGLASS CO. ‘24, Darya Gan, Delhi 110002 CREDIT NOTE Date: 152202200 ‘WitKumay = lebtor. Fe is allowed he amount enable the \ specimen = : ongmer Peectet— Sorc Decimerts nd Papert of owen Anition that when geT#CNCINg & buniness transaction. It ows from the above setlished: Such ovise transection is entered inter an erie effect is also established. Such evidences ~ Documents. On the basis of Source Decumeng, a voucher detailing the accounts that are debited moe ne nl is prepar Types of Voucher Vouchers may be categorised into. 1. Source Vor sears routers oF Source Documenta or Supporting Vouchers, end J, Souree Vouchers or Source Documents or Supporting Vouchera Same into exitenee sau’ Documents o Supporting Veneta one erent which game into existence when a transactions eee Features of Source Voucher: amend inh (@ Itis a written document ip Te contains complete details ofthe transaction, (i Tein a proof ofa transaction having taken ec, (i) Its generally for a business wees cae (©) Ibis signed by the maker 2. Accounting Vouchers Aap at he with him source or supporting vouchers for cash paymonte, eash sane voices for credit purchases and sales Yat, btore occa a ea account, these source vouch sed to determine which necount oe neers seco asited and credited. The decison is recorded om gwen eens an ‘Accounting Voucher inn wetter document containing an analyeis ofan : Features of Accounting Voucher: ( It is a written document, (ii) It is prepared on the basis of evidence of the (iid) It is an analysis of a transaction, (iv) It is prepared and si authorised signatory. (v) In the case of cash/bank voucher, it is a receipt. ‘Types of. Accounting Vouchers Accounting Vouchers are of two types, i.e. 1. Cash Vouchers; and 2. Non-Cash Vouchers or Transfer Vouchers. Let us discuss them in detail. 1. Cash Vouchers {ash Voucher is the voucher prepared at the time of rece includes receipt and payment through cheques, transaction, i ‘ource Document, igned usually by an Accountant and countersigned by the ipt or payment of cash and a™ ” Double Entry Book, "ny Cash Vouchers can be of two types namely () Credit Voucher and (i) oy, : () Credit Vouchers "Vou, Credit Vouchers are prepared when cash is received. Cash may j,. against (a) sales of goods, (b) sale of fixed assets, (€) sale of y\* Teg (d) receipts from debtors, (e) withdrawal from bank, ete tm A format of a Credit (Cash) Voucher is given below: : ‘ cReDIT VOUCHER HARRY & SONS (P) LTD. 24, Rajiv Chowk, New Delhi 110.007: Oate-13.2.202) Amount @) Get Sales Ne (God sora ide to iia nie t y ® 0 ‘The Credit Voucher gives the following information: 1. Name and Address of the Organisation. 6, Narration, ie, a brief deserptgn 2. Date of Preparing the Voucher. of the transaction. 8. Accounting Voucher Number 7. Signature of the Person prepari 4. Title of the Account Credited. 8, Signature ofthe Authorised Signet 5. Amount of the Transaction. 9. Supporting Voucher Number.” (ii) Debit Vouchers Debit Vouchers are prepared when payment is made. Payment may be mag against (a) expenses, (b) purchases of goods, (c) purchase of fixed asus (d) payment to creditors, (e) deposits into bank, (/) drawings, ete. A format of a Debit (Cash) Voucher is given below: @ * DEBIT VOUCHER HARRY & SONS (P)LTD. 24, Raj Chow New Deh 110007 =n > Voucher No. 51 Date: 132.2022-f---> 2 ‘Amount @) Debit: Purchases Ne 19600 e (Furiture purchased vide ——~ -| ely (ash Memo No. 726)——~ 6 m6 Si ‘d= Manager Accountant ¥ + Y co, @ aDebit y Aq Debit Voucher gives the following ing inye "te sth "Name and Address of the Organisation. 7, ee ene te nT. Signature ofthe Paro rain Ht §, Accounting Voucher Number. 8. sina ad clas 1 Title of the Account Debited souk Dosa ek peaneenueretent Aes of the Supporting bg, Narration, ie @ brief description o “os x the transaction. 7 3. Non-Cash Vouchers or Transfer Vouchers a, Non-Cash Vouchers are the vo > on-Cash Vouchers the vouchers prepared for transactions not involving eash. ~:) _Baamrlet thon ny invoice or Bills, Debit and Credit Notes, ete. Non-Cash Vouehers Pamirepared forthe transactions of eredit eas, ert purchases, ods returned (oth te aards and outwards), rectifying the errors, ete " ‘Aformat of a Non-Cash Voucher is given below: @ 9 “TRANSFER VOUCHER T TWARRY & CO.(P)LTD. IL 10, Gole Market, New Delhi 710001 ancy oe dervioin | le se Machinery A/c — ined Signatoy (Machinery Purchased ~ e umber, Wide Bil No.7) 2 as >o) >) may be mai fixed asset Y y a jing information: 6. Narration. 7, Signature of the Person preparing + {&, Signature of the Authorised Signatory. porting Voucher Number. Non-Cash Voucher gives the follow 1. Name and Address of the Organisation 2. Date of Preparins 3. Accounting Voucher Number. 4, Titles of the Accounts Debited and Credited. 9. Sup 5. Transaction Amount.‘The evidence (Source Document), ie, Cash Memo, ete., by itself ig q VOU, 4 practice normally, a printed paper called Voucher is prepared on which the ey, “ ‘ nat . uy be debited and credited along with the description (narration) of the transaction iy A specimen of a Voucher is given below: XYZ&CO, i Voucher No, a er i Debit: Stationery Nc re i (Pens, papers ee, purchased from M/S. Ashok Ca. in cash) a : Bl cea Gana 8 3 3|———. ; a - sal = Authorised Signatory ia Let us now discuss the manner in which a voucher is Prepared. The soune document is analysed to determine the nature of a transaction and the accounts to be debited and credited. Let us take a simple example. XYZ & Co. purchases Stationery for & 750 against cash payment for which it receives a Cash Memo along with the stationery items. An analysis of Source Document (Cash Memo) Let us take another example not involving receipt or payment of cash. $ Mis. Rahul & Co. purchases stationery of € 1,100 from Mis. and receives their invoice or bill. As an expense has been incurred, € 1,100) will be debited and the account of Mis. Ashok & Co. will they have supplied goods on credit following the rule ‘Increase in li ‘and decrease is debited’. Voucher for the above transaction will be 88——X— agin! | (M/S RAHUL & CO. Voucher No. a Amount (©) Debit: Stationery Aye Te Bill No. .... dated —..) ue Credit: M/s Ashok & Co, is a sn miustration 1. Following transactions took place in Prabhat Bleetrie Co., Delhi. Prepare the debit vouchers Date: 1.1.2022 Amount () 10,000 710,000 sdi- ‘Accountant| ? 10 ouble Entry Book Keeping cp, ” , |} Mlustration 2. I | Mostration Veco Traders Patnn. Peepare the debit your, took place in M 3,500 ate:1.120 Voucher No.1 aroun Debit: Furniture Ac ak a (Fonte Purchased vide Cs . re a: a ae 20 me str Account | f | iz eee rf Date: 8.1.202 | j Amount) FF Pew Wages Ae a. ; {Wages Paid for December, 2021)Ss —_oarvoxXrC pinot ansac¥ons-—Soure Documents and Preparation of Vouchers mM Ww) ay i (M/S ACETRADERS Meactat Nod Owe. 13002 ‘Amount Debit: Postage Ave 200 (Amount paid for Postage Stamps) 200 ath a sy sor j i ‘Manager ‘Accountant iustration 3. | prepare the Credit Vouchers from the source vouchers of M/s Ram Lal & Co., New Delhi pased on the following transactions: ‘Sold goods for cash vide Cash Memo No.64 ‘Sold old typewriter for cash vide cash receipt No, 344 Date: 5.42022. Amount @) 12,000 12,000 ‘Accountant“N 12 Double Entry og in e E — Oey Cred: Bank Ne (Cash withdraw from Bank vide Cheque No 12349), Sd Manager Mustration 4, Prepare Credit Vouchers from the following information, collect vouchers of Mis Imperial Leather Stores, Agra (U.P): from sup (January 5 | Received cash rom Ws Mohan & Coon acount vide cash receipt Na. 351 {ih Janvary 10 | Commission recived vide cash receipt No. 360, Sold leather purses cgalstcash vide Cash Memo Nos. 317-320, | clo ld sevng actin vide Cesh Mero No 1230 dates. Araat A a ee Cede Ws Mohan Co, ‘00 (Cash received on account rom M/s Mahan & Co vide cash receipt No. 351) Toa OO ) sa Manager Gar M/S IMPERIAL LEATHER STORES vectra | | Great Sewing Machines A/c - | 2,500 (Two old sewing machines sold for Cash vide Cash Memo No. 1230) 2,500 sd Sa Manager ‘Accountant Mlustration Prepare the Accounting Voucher from the ing voucher: RAM RATAN & SONS 32 Industrial Area, Meerut (U.P) Sale il No. 1215 Date: 104.2022 Ws Muar Lal & Sons Qty. | Particulars | Raterunit ®) | Amount @) Cricket balls | 100 | 2,000 Ram Ratan &Sons |™“ Double Entry Book Kopp na Solution, a RATAN SORE Multiple Choice Questions (MCQs) Select the correct alternative (0. Cash memo is prepared when goods are sold (a) on eredit. (6) on cash (©) Both (a) and (6) (2) None of these. Cash memo is a source voucher for purchaser of goods (a) for eash purchases. (6) for eredit purchases, (0) for credit sales. (a) for eash sales. (i) Invoiee is a source voucher for seller of goods (a) for cash sales (0) for credit purchases, (©) for eredit sales. (d) for cash purchases. (éx) Invoice is a source voucher for purchaser of goods (a) for cash purchases, (}) for ensh sales, (©) forcredit sales. (@) for credit purchases, (©) Accounting voucher is prepared from (a) source voucher. (6) Journal entry. (©) Both (a) and () (d) None of these, (vi) If purchaser of goods returns them, he will prepare (@) Credit Note () Debit Note. (©) Both (a) and 6), (a) None of these. (ii) If seller receives back the goods sold, he will prepare (@) Crodit Note (8) Debit Note. (©) Both (a) and (by (d) None of these. (viii) Voucher is prepared for (@) Cash and Credit purchases. (b) Ca (©) Cash received and paid. (@) Allof these h and Credit sales,, sem - ie : th car and th tea mniere: vinichier for ws “ jut purchase ta) Cash purelnse Credit pure fey tte ad and tay exther ta) noe ino Dooks a Acute writen an he hat of tay Sours Document «hy Accounting Voucher Ge) Moth (a) and {dy Nonw of these ai) Crest Note ts prepared fa) when credit is given to the account (b) when debit is iven to the account () bath (a) and (a) None of the above. (gia When goods are sokl on credit, the seller prepares (a) Cash Memo, (b) Invoice {¢) Accounting Voucher (a) None of these, ain) When goods are purchased sgainst eash, the purchaser will get (a) Cash Memo. (8) Invoice. (o) Accounting Voucher. (@) None of these, (qv) Transfer vouchers are prepared to record (a) cash transactions. (6) non-cash transactions. (© (@ and 0. (a) None of these. (avi) Credit purchase of furniture is recorded through (a) Transfer voucher. (b) Cash voucher. (©) Debit voucher, (@) Credit voucher. [Ans (2) (Bs Gi) (a): Ki) (eh; ev) Cd): (0) (a (vid (B); Coit) (a (wit) (A ix) (as) (b); (ai) (Bh wi) (a); (aid) (B); (ain) (a); (xv) (6); CoV) (@D.] 1, State whether the following statements are True or False: (Credit Vouchers are the documentary evidence of the cash pay ents, Gi) Transfer Vouchers are prepared to record the non-cash transactions, (ii) Cash Memo is prepared by the seller when the goods are sold for cash. (i) AVoucher is a documentary evidence of the busi transactions having taken place (©) Credit Voucher is a document for having deposits made in the bank. (si) Cash Vouchers are of two types, viz,, Debit Vouchers and Credit Vouchers. (Ans. (i) False; Gi) True; (iti) True; (iv) True: (v) False; (vi) True}716 Double Entry g 100k Ko Hillan the blanks with appropriate word: ) are the evidence of busines transactions Which prong, I about the nature of the transaction and the amount involved in jt. "hry “in Vouchers are the documentary evidence ofthe cash y To) Vouchers are the documentary evidence of the cash ree, eCvipg Vouchers are the documentary evidence of the cash ash payment in ay w Vouchers are the documentary evidence of Non-cash ty [Ans.: (i) Source documents; (i) Debit; it) Credit; (ix) Cash; (v) hort Answer Type Questions) QL. Name a Non-Cash op Tras, oa y two source documents, (Cash Memo; and i) Invoice. Is ‘Cash Memo’ a source document or an Accounting Voucher? wai Ans, Cash Memo is a source document prepared by the seller of goods for cash . : Q. 8, What is an Invoice? Ans. Invoice is « souree document prepared by the seller of gonds on eredit Q-4. What do you mean by Voucher? (ety or Define Voucher. ely Ans. The documents prepared for the purpose of recording business transactions in the books of account are known as Vouchers. Q.5. How an Accounting Voucher is prepared? Ans. Accounting Voucher is prepared on the basis of source voucher after analysing and determining accounts to be debited and eredited Briefly explain Cash Voucher. Cash Voucher is prepared at tho time of receipt or payment of cash or cheque. Briefly explain Credit Voucher Credit Voucher is prepared when Q.8. What is Transfer Voucher? Ans. Non-cash vouchers (or transfer vouchers) a ash is received. the documentary evidence of non-cash goo wns ea avin sie St Chana Ans. Pay «source document for having deposit ie Q.10. Define a Cheque and payuble on oF after cher will be prepared for it. a nn jor Answer Type Questions) | tani ay Ss Da 4 ive an example of Voucher “es forcanh, Pea, gat ate Accounting Vouchers ed viet ave the 170 of Aceunting Vourtant o same tt ten Of YonEheis BA Closet (6a 1, Fallong er analysing g ought Computer Mouse 4 Nos) vide Cash Memo No 338 FB | wages paid forthe month of December, 2021 = ome | | paid cash to Har & Sons vide receipt No 102 for eps — | ian. Paid = f Paid postage . . sre vide Cash Memo No. 210 \ Purchased fur a Bank Opened a Bank A Purchaser Sold shir Sold shins f withdrew from b Withdrew for pes insictions took place in Mls Geek Computers Prepare the ets MSE Chandigarh Acunting Vuh 00| 4 cash from Wahi & CO. ‘on acount vide cash Pt No. 551 [ commisionseceee 0 eather pus Pes ide cosh Me NO 15 é i machines ie on UES 5 propane the Transfer Vauetoers the DOORS ‘shiva Agencies, Faridabad, Haryana fr ihe Source Voucher chased god om wr os New Dh we i NS onto al, reise. Haan ie BNO 3396 ng 10% on € 2.00000 Jon, _31 | Demeciton charged on bi