SECTION 2: SOURCES AND RECORDING OF DATA

1. Raminder provided the following information for March 20-9:

March 1 Balance of cash 100

Balance at bank 2 750

4 Received cheque from Wahid, a credit customer 280

9 Paid office expenses in cash 22

13 Received a loan from AB Loans by cheque 5 000

18 Purchased equipment and paid by cheque 4 500

24 Received commission by cheque 150

28 Paid Sabena, a credit supplier, by cheque 330

31 Cash sales 840

Raminder took cash for personal use 200

Record the above transactions in Raminder's cash account and bank account. Balance the accounts on
31 March and bring down the balances on 1 April 20-9.

2. Mona started a business on 1 January 20-4. The following are her transactions for the first two
weeks of trading:

January 1 Capital, $20000, was paid into a business bank account.

Paid rent, $500, by cheque.

2 Bought goods, $3300, on credit from Mohamed.

4 Returned goods, $100, to Mohamed.

7 Sold goods, $1700, on credit to Aswan Traders.

9 Received $120 commission in cash.

10 Paid Mohamed $3000 by cheque on account.

12 Aswan Traders paid $1000 by cheque on account.

13 Paid office expenses in cash $20.

14 Cash sales, $1500.

Cash withdrawn for personal use, $500.

Enter the above transactions in the ledger of Mona. Balance the cash account, the bank account and
the accounts of Mohamed and Aswan Traders on 14 January and bring down the balances on 15
January 20-4.
3. The balances on Anjori's cash and bank accounts on 1 May 20-9 were:

Cash 200

Bank 4960

The following transactions took place during the month:

May

4 Paid Western Stores $2 120 by bank transfer.

9 Received a cheque, $1310, from C Wright.

13 Cash sales, $950.

15 Paid $40 in cash for carriage on sales.

19 Paid $900 cash into bank.

22 Anjori withdrew $500 from the bank for her own use.

26 Paid insurance, $1 420, by direct debit.

30 Purchased a motor vehicle, $5500, and paid by cheque.

a Record the transactions for May in Anjori's cash book and bring down the balances on 1 June 20-9.

b Explain the meaning of the word 'contra' when used in connection with cash books.

c Explain why it is not possible to have a credit balance brought down on a cash account.

d State whether the cash balance and the bank balance in Anjori's cash book at the end of May 20-9
represent assets or liabilities.