The topic entails

- Explaining meaning of cash book and the types of transactions recorded in the cash book.
- Discussing the purpose of a cash book
- Types of cash book when used and format
- Explain the concept contra-entry.
- Preparation of the various types of cash books.
1. The following cash book relates to Baraka enterprises

Date Details Cash Bank Date Details Cash Bank

2004 2004 15,000
Jan 1 Bal. b/d 10,000 Jan 1 Bal b/d
Jan 10 Sales 18,500 Jan 15 Bank 12,000
Jan 15 Cash Bal. 12,000 Jan 20 Jebet Bal. 6,000
c/d 3,000 c/d 10,500
28,500 15,000 28,500 15,000

State the transactions that took place on the above cashbook on the following dates
Jan 1
Jan 10
Jan 15
Jan 20
2. Identify four uses of the cash book.

3. The following transactions took place in the business of Kiprono during the first week of
Jan. 2003
Jan 1st Balance brought down
Cash = Kshs12,000.00
Bank= Kshs.35,000
Jan 2nd Sold an old piece of furniture for Kshs.8,000 cash
Jan 3rd Cash sales Kshs.10,000 paid directly to the bank
Jan 4th Purchased goods worth Kshs.20,000 , paid Kshs.5,000 cash and the balance to be
paid later
Jan 5th Kiprono took cash Kshs.1,500 for personal use
Jan 6th Bought goods worth Kshs.15,000 paying partly by cheque Kshs.10,000 and the
balance in cash
Required: Prepare Kiprono’s two column cash book for the month of January and
balance it of
4. The following transactions relate to Kabela Traders for the month of Dec. 2004.
2nd Dec cash sales shs.30,000
8th Dec. Banked shs.15,000
10th Dec. withdrew shs.10,000 from bank for office use
Prepare a cash book
5. Ondiko Traders had Kshs. 100000 cash in hand and Kshs.243000 cash at bank during the
Month of March 2008. The following transactions took place in that month:
March 3 – paid rent Kshs.5000 cash
March 11- cash sales Kshs.14000
March 14-purchased equipment worth Kshs. 37000 paying by cheque
March 20- Deposited shs. 30000 into bank from cash till
March 31- Took Kshs. 10000 cash for personal use
Prepare Ondiko traders’ two- column cash book for March 2008
6. Record the following transactions in a double column cash book of JABER traders and
balance it off as at 12th June 2009:-
June 1: Balances : Cash shs.5500
Bank shs.18000 (Cr)
June 3: Purchases shs.4500 was made being paid by cheque shs.4000, balance later
June 7: Sold goods for cash shs.6000
June 12: took shs.7000 to bank
June 13: Credit purchases from Ombogo shs.3000
June 14: paid Alweny shs.1000 cash
7. State the meaning of the following terms as used in a cash book:
a) Contra- entry
b) Folio column
8. The following information was obtained from Laban traders during the month of February
2010
Feb. 4: goods returned by Otange traders amounted to kshs. 4 000, credit note no.214
8: Akamba traders returned goods worth kshs. 15 000 and was issued with credit note no.316
15: received goods worth ksh.6,000 from punch line traders. Credit note 510
28: goods returned by Viva traders’ kshs. 9 600. Credit note no. 440
Prepare the relevant journal for Laban traders
9. Omondi had the following transaction in the year ending 30th June 2008:-
Shs
Debtors as at 1st July 2007 113 000
Cash received from debtors in the year 651 500
Debtors as at 30th June 2008 138 500
Bad debts in the year 1 700
Discounts allowed in the year 2 600
Cash sales 800 000
Calculate the total sales for the year

10. Give three documents from which information entered in cash receipts and cash payments
Journals may be obtained
11. The following information was available for the year 2009:-
2009 Accrued rent Prepaid rent
Jan 1 Shs.20,000 Shs.40,000
Dec 31 Shs.36,000 Shs.3400
Rent expense paid in the course of the year amounted to shs.121,200.
Prepare the rent account and show the amount charged to profit and loss account
12. On March 2007, Doris had cash in hand shs.87,000 and cash at bank shs.25,000. During this
month, the following transactions took place:
March 2nd : Cash sales shs.60,000
3rd: Paid salaries shs.101,500 by cheque
7th : Received a cheque of shs.76,000 from Henry after allowing a cash discount of 5%
13th: Bought office furniture by cheque shs.86,000
17th: Settle marital account for shs.34,200 in cash having deducted shs.8,000 cash discount
20th: Received a cheque for shs.165,000 in respect for cash sales
22nd: Paid wages shs.25,000 in cash
24th: Withdrew shs.32,000 for bank for office use
25th : Withdrew shs.4,000 cash for personal use
29th: Received shs.17,000 cash form Alvin in settlement of his account less shs.1000 cash
discount
31st : Deposited all the money into the bank except shs.24,600
Required: Prepare a three column cash book duly balanced
14. Mumji Enterprises maintain a petty cash book on an imprest system with weekly float of
Kshs.40,000.
The following information relates to the week ended 7th June 2009:-
1st cash in hand was Ksh.7000
1st receives reimbursement from the chief cashier
1st paid wages Ksh.5500, bus fare Ksh.1250,Sugar sh.220 and stamps shs.150
2nd Bought stationery Ksh.5000
3rd Paid postage shs.200
4th Bought tea leaves shs.80 and shs.2000 for type writer repair
5th Bought coffee shs.340 and milk shs.800
7th Bought a ribbon for type writer shs.500, stencils shs.350 and bus fare shs.900
Required: - Prepare a petty cash book duly balanced on 7th June with the following
columns.Traveling, Wages, Stationary, Postage, tea and miscellaneous
17. A petty cashier of Mugirango traders operates his petty cash book on an imprest system of
sh. 2500. On I February 2009, he had cash in hand of Sh. 500 and was reimbursed the difference
by the main cashier to restore his cash float. The following transactions took place during the
same month of February 2009:
Feb 2nd paid taxi fare sh.150 and wages sh250
 4th Bought five reams of paper for sh25 each and stamps for sh.30
7th Paid wages sh.250 and bought envelopes for sh.40
20th Bought tea for staff sh.70 and paid for water bills sh.56
28th Paid for electricity sh.80 and stamps sh.40
Required: Prepare a petty cash book using the following analysis columns; • Wages • Traveling
• Stationery •Postage • Miscellaneous