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Answer Posted / arif
Some transactions are recorded in a three column cash book.
Which refers to both cash & bank i.e. balance of one will decrease and other will increase due to such transactions. Such transactions are entered on both sides of the cash book. Such entries are known as Contra Entries.
Contra entry is one which is recorded on both side of
the three column cash book by indicating capital 'C' in L.F column. It is recorded only when one of the following transactions takes place.
1. When cash deposited in to bank.
2. When cash withdrawal form bank.
3. Also cash transfer from one bank to another bank.
Bank A/c Dr. ***
To cash A/c ****
(Cash deposited into bank)
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