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Simple journal entry

ANKIT PUNAMIYA (STUDENT) (94 Points)

02 August 2012

received a bearer cheque for 15000 from dhanraj

1> bank a/c ......... dr

to Dhanraj's a/c

2 > cash a/c ......... dr

to dhanraj's a/c

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13 Replies

vaisagh menon k (B.COM,C.A FINAL) (211 Points)
Replied 02 August 2012

IF DHANRAJ IS DEBTOR

bank a/c ......... dr

to Dhanraj's a/c

bank is debited because money comes to bank

dhanraj is credited to cancel the current debit balance upto received amount

ANKIT PUNAMIYA (STUDENT) (94 Points)
Replied 02 August 2012

think again bcoz in most of the textbooks its given as cash and not bank i think the reason would be bearer cheque bcoz it can be encashed immediately at the counter what do u think?

Dev (Article Trainee.) (608 Points)
Replied 02 August 2012

when we recieve cheque but dont deposit same day in bank... We treat cheque as a Cash in cash book.. Eg. assume that we recieved cheque amounting 500 and deposited in bank same day.. entry in book.. Bank a/c Dr 500 To Debtor a/c 500... and Suppose we recieved cheque but didnt deposit same day in bank.. Entry in book.. Cash a/c Dr. 500 To Debtor a/c 500.. and suppose after 4 day or any other day we deposited in bank.. Entry in book.. Bank a/c Dr. 500 To Cash a/c 500. (contra ) correct me if m wrong..

mahendra jangid (Dy. General Manager (Finance)) (444 Points)
Replied 02 August 2012

If you took the cheque directly to bank and withdrew cash then

Cash Dr

To Dhanraj (if he is a Debtor)

If cheque deposited into bank (with or without crossing) into bank then

Bank A/C Dr

To Dhanraj (if he is a Debtor)

Authors of various books can take either of them. Both are correct. At professonal exam level, you may put a note clarifying above position.

1 Like

Varshit Shah (Self Employed) (676 Points)
Replied 02 August 2012

Practically it depends where you have deposited this amount :

For eg : If you got cash from the Cheque issuing bank , & u have not deposited same into the bank then it will be ,
Cash A/c..................Dr
To Debtor A/c
Becuse if you added to your petty cash book i.e. your cash got increased by this much figure.

Now Case 2 :

You got the cheque encashed , & deposited the entire amount to Bank :

Then :

Cash.............Dr
To Debtor

ANS

Bank..........Dr
To Cash

OR

Bank.......Dr
to Debtors

Varsh*t Shah

Bhaavna (Queen ) (1933 Points)
Replied 02 August 2012

Originally posted by : Varsh*t Shah
	Practically it depends where you have deposited this amount : For eg : If you got cash from the Cheque issuing bank , & u have not deposited same into the bank then it will be , Cash A/c..................Dr To Debtor A/c Becuse if you added to your petty cash book i.e. your cash got increased by this much figure. Now Case 2 : You got the cheque encashed , & deposited the entire amount to Bank : Then : Cash.............Dr To Debtor ANS Bank..........Dr To Cash OR Bank.......Dr to Debtors Varsh*t Shah

yes i agree with shah

A. Mukherjee (CA Student) (65 Points)
Replied 03 August 2012

A bearer cheque is often treated to be equivalent to cash. This because the bank will give you the cash and not directly deposit it in your account. Therefore the entry depends totally on your assumption of what you do with the cash. If you deposit it in your account then debit Bank A/C, otherwise debit Cash A/C. Therefore both are correct. If the question comes in exam, you may write your assumption separately.

1 Like