Important Questions for CBSE Class 11 Accountancy Chapter 4 – Recording Of Transactions 2

Important Questions Class 11 Accountancy Chapter 4 – Recording of Transactions II (Financial Accounting – I)

Accountancy is a crucial subject for both the 11th and 12th Classes. Students need to understand the concepts and apply them correctly while solving numerical questions. Thorough knowledge of the basic principles and practices will serve as a  stepping stone toward a successful career in Accounting. Chapter 4 for Class 11 Accountancy is about Recording of Transactions II (Financial Accounting – I) and gives a step-by-step method in the Accounting process, i.e. recording transactions in a specific journal. Students must go through the Important Questions Class 11 Accountancy Chapter 4 as this chapter covers the subdivisions of the journal into which transactions of similar nature are recorded. It also sheds light on preparing cash books, petty cash books, and special purpose books and posting them into the ledger accounts. 

Important Questions of Cash Book Class 11 will help them to learn with a proper understanding of various transactions, and the special purposes of books such as cash books, purchases books, return books, etc, putting them in the ledger will give them more clarity about the purposes with concrete examples. Complete knowledge and their applications will give students added confidence to answer any question without ambiguity. Furthermore, they will know how to answer similar questions in the subsequent chapters while preparing for their examinations to score 100% and set the benchmark. st. 

Creating a solid foundation in concepts and solving numerical where Accountancy is considered necessary.  At Extramarks, we completely understand the importance of practicing such questions. For this purpose, Extramarks picks crucial questions from various sources such as NCERT books, NCERT Exemplar, other reference books, past years’ question papers, and so on to prepare a repository based on NCERT books that is aligned with CBSE guidelines. The accountancy subject experts have created step-by-step solutions so that students can learn important points easily and make them revise quickly with the help of Important Questions Class 11 Accountancy Chapter 4 and to give 100% performance in their examinations and create their first milestone.

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CBSE Class 11 Accountancy Important Questions

Sr No Chapters Chapter Name
1 Chapter 1 Introduction to Accounting
2 Chapter 2 Theory Base of Accounting
3 Chapter 3 Recording of Transactions– 1
4 Chapter 4 Recording of Transactions II (Financial Accounting – I)
5 Chapter 5 Bank Reconciliation Statement
6 Chapter 6 Trial Balance and Rectification of Errors
7 Chapter 7 Depreciation, Provisions, and Reserves
8 Chapter 8 Bill of Exchange
9 Chapter 9 Financial Statements – 1
10 Chapter 10 Financial Statements 2
11 Chapter 11 Accounts from Incomplete Records
12 Chapter 12 Applications of Computers in Accounting
13 Chapter 13 Computerised Accounting System

Important Questions of Cash Book Class 11 Accountancy Chapter 4 with Solutions

To help the students maximize their potential, Extramarks has curated a list of Chapter 4 Class 11 Accountancy Important Questions that covers questions from various crucial topics that are in the chapter. The step-by-step solutions are conveyed in a straightforward manner so that students can understand, recall and apply their knowledge without much difficulty.

 A list of   Important questionnaires with answers from Class 11 Accountancy Chapter 4 is given below:  .

Question 1. Cash purchase of goods is recorded in-

  • Purchase Book
  • Sales Book
  • Cash Book
  • None of these

Answer 1: (c) Cash Book

Explanation: Cash book is a book in which all transactions relating to cash receipts and cash payments are recorded. It starts with the cash or bank balances at the beginning of the period.

Question 2. What is the subdivision  of a journal?

Answer 2: As the business expands, it might get a little challenging to record all the entries in a single book, i.e. journal. And as many transactions become repetitive, It becomes more accessible to then record transactions of similar nature in separate special books. For example, all cash transactions can be recorded in one book; all credit transactions can go in one book, all purchase transactions in one book, and so on. These special books are called day books or subsidiary books. 

Question 3. State the following questions as  true or  false:

  • More than one credit account and a single debit account in an entry is known as a compound entry.
  • Subsidiary book is also known as a ledger.
  • Credit purchase of machinery is entered in purchase book

Answer 3: 

  1. True. This entry is  regarded  as a compound entry as it involves  more than 2 accounts.
  2. False. Subsidiary books are a set of intermediary accounts linked to the ledger.
  3. False. Purchase of machinery should be recorded in a journal with a proper account.

Question 4. Write the process of preparing a ledger from a journal.

Answer 4: The process of preparing a ledger account can be understood with the help of an example. Let us suppose a Machinery is purchased from Mr X, so the journal entry for the same would be;

           Machinery A/c …Dr.

                   To Mr X A/c

In the above journal entry, Machinery A/c is debited, and Mr X A/c is credited. The steps for preparing a ledger account would then be as follows

For the account which is debited

  • Identify the account that is debited in the journal entry. In our example, it is the machinery account.
  • In the ‘Machinery A/c’, enter the date in the ‘Date’ column on the account’s debit side.
  • On the debit side of the account, in the ‘Particulars’ column, enter ‘Mr. X’ (which was credited)
  • In the Journal Folio or ‘J.F’ column, add the page number where the entry is mentioned in the journal
  • In the ‘Amount’ column, add the corresponding amount of the journal entry.

For the account which is credited

  • Identify the account that is credited in the journal entry. In our example, it is the ‘Mr X.’ account.
  • In the ‘Mr. X.’ enter the date in the ‘Date’ column on the credit side of the account.
  • In the debit side of the account, in the ‘Particulars’ column, enter ‘Machinery A/c’ (which was credited)
  • In the Journal Folio or ‘J.F’ column, add the page number where the entry is mentioned in the journal.
  • In the ‘Amount’ column, add the corresponding amount of the journal entry.

Question 5. Give the meaning of the following terms

  • Sales journal
  • Purchase journal
  • Journal
  • Petty cash book

Answer 5: 

  1. Sales Journal: Sales journal exclusively records all credit sales transactions.
  2. Purchase Journal: Purchase journal records all the transactions of credit purchases.
  3. Journal: Journal is referred to as books of original entry where all initial transactions are recorded.
  4. Petty Cash Book: Petty cash book is used to record all the small cash transactions that occur in a business for a particular period.

Question 6. What is the difference between a trade discount and a cash discount?

Answer 6: The following are the differences between trade discount and cash discount;

Basis of Difference Trade Discount Cash Discount
Meaning Trade discount is the discount offered at the time of purchase of the goods. A cash discount is a discount which is offered at the time of payment for the goods.
Purpose The purpose of trade discounts is to encourage sales. The purpose of cash discounts is to encourage payment.
Deduction  The price deduction is given on the actual price of the goods. The price deduction is given on the invoice for the goods.
Recording in the books Trade discounts are  not recorded in the journal. A cash discount is recorded in the journal.

Question 7.  Explain the Debit and Credit note in five sentences.

Answer 7: 

Debit Note: A debit note is prepared when the buyer returns goods to the supplier. It contains the name of the party to whom the goods are returned and the details for which the goods were returned. Every debit note will have a serial number and a date.

Credit Note: A credit note is prepared by the supplier when goods are returned to them by the buyer. The credit note contains the customer’s name and other details such as the goods received and the amount. Every credit note will have a date and a serial number.

Question 8.  Write the difference between return inwards and return outwards.

Answer 8: The difference between return inwards and return outward is mentioned below:

Basis Return Inward Return Outward
Meaning Return inward implies goods returned to the business by the customers. Return outward implies the goods sent back to the supplier by the business.
Balance It has a debit balance. It has a credit balance.
Note Issued A credit note is prepared by the seller. . The buyer prepares a debit note.
Treatment Return inward amount is deducted from ‘Sales’ in the Trading Account. Return outward is deducted from the ‘Purchases’ in the Trading Account. 
Reduction Reduces the payment from the debtors Reduces the payment to the creditors’
Term used Sales return is another term for return inward. Purchase return is another name for return outward.

Question 9. Record the following transactions during the week ending Dec.30, 2014,

with a weekly, imprest Rs. 500.

2017 `


24           Stationery                                         100

25           Bus fare                                               12

25           Cartage                                                40

26           Taxi fare                                               80

27           Wages to casual labour                    90

29           Postage                                                80

Answer 9:                                                                        Petty Cash Book



Date Particulars Voucher




Analysis of Payments Remarks


    Postage Telephone

& Telegram

Conveyance Stationery Misc.
500 24 Jun Cash Received
24 Jun Stationery 100 100
25 Jun Bus Fare 12 12
25 Jun Cartage 40 40
26 Jun Taxi Fare 80 80
27 Jun Wages to casual labour 90 90
27 Jun Postage 80 80
402 80 132 100 90
27 Jun Balance c/d 98
500 500
98 28 Jun Balance b/d
402 28 Jun Cash received

Question 10. Enter the following transactions into cash book for the month of Jan 2018

  • Cash received from Ravi 4,000 
  • Rent Paid in cash 2,000 
  • Purchased goods from Mahesh for cash 6,000
  • Sold goods for cash 9,000

Answer 10:   Cash book for the month of Jan 2018

Dr.         Cr.

Date  Particulars  Amount  Date  Particulars  Amount 
To Ravi 4000
By Rent 2000
To Sales 9000
  1. b
By Purchase 6000
By Balance c/d 5000
13000 13000

Working Notes:


Date Particulars Dr.  Cr.
Cash A/c                                                    Dr. 4000
              To Ravi A/c 4000
(being cash received from Ravi) 
Rent A/c                                                    Dr. 2000
              To Cash A/c 2000
(being rent paid in cash) 
Purchase A/c                                            Dr. 6000
                To Cash A/c 6000
(being purchased goods on cash from Mahesh)
Cash A/c                                                    Dr. 9000
            To Sales A/c 9000
(being goods sold in cash) 

Question 11. What is a petty cash book? Write the advantages of petty cash books?

Answer 11: Recording repetitive transactions in smaller denominations can be burdensome on the cash book; hence a separate book known as the ‘Petty Cash Book’ is created for the purpose of recording transactions of this nature. Examples of petty cash expenses include stationery, postage, conveyance, refreshments, etc. A petty cashier maintains a petty cash book.

The system of preparation for the petty cash book is the Imprest system. Under this system, the petty cashier receives a certain sum of money for a period; post the exhaustion of the funds, they are reimbursed so that they may have the same amount as in the starting period.

Petty Cash Book
Dr. Cr.
Amount Received Date Particulars Voucher No. Amount Paid

Analysis of Payments
Postage Stationery Conveyance Telephone &


Miscellaneous Remarks

Advantages of Petty Cash Book:

  1. Avoid bulky cash books: By maintaining a petty cash book, the cash book is not burdened with transactions of repetitive nature, and small denominations make the cash book less bulky.
  2. Division of labour: The handling of petty cash expenses is delegated to the Petty Cashier; hence there is a division of labour, and the main cashier can work efficiently in the more essential areas.
  3. Prone to less error: The petty cash goes through regular audits so that it is prone to fewer errors and inefficiencies.
  4. Simple method: The method of recording transactions is pretty simple in a petty cash book. There are separate heads under which each petty expense can be placed. Also recording transactions in a petty cash book does not require formal knowledge of all accounting principles and techniques.

Question 12. What is a cash book? Explain the types of cash books.

Answer 12: A cash book is a book of original entries where all cash-related transactions are recorded, i.e. cash receipts and cash payments. Cash deposits and withdrawals are all recorded in sequential order. There are two columns on either side of the cash account of cash and bank, so all cash-related transactions are recorded in the cash column, whereas all bank-related entries go in the bank column. For example, cash sales by the business will be recorded in the cash column on the debit side, but payments made to creditors via cheque will be recorded in the bank column on the credit side of the cash account.

Cash Book

Dr.         Cr.

Date Particulars  L.F. Cash Bank Date Particulars L.F. Cash Bank
Cash (c) Bank (c)

Types of cash books:

Types of cash books:

  • Single Column Cash Book:

In a Single Column Cash Book, only cash-related transactions are recorded. It is helpful for enterprises that only maintain cash transactions. It has records of cash receipts and cash payments. 

  • Double Column Cash Book:

The Two Column Cash Book is more commonly referred to as the Double Column Cash Book. It contains two columns of cash on either side, i.e. debit and credit. One side is used to record cash transactions, and one side is used to record bank transactions. 

Cash transactions are recorded in the cash column, and bank transactions relating to cheque  deposits and payments made by cheques are recorded in the bank columns. Some organisations prefer the double column cash book as it contains both the cash and the bank account, thus eliminating the need for two separate ledgers.

  • Triple Column Cash Book:

As the name suggests, a Triple Column Cash Book consists of three columns: cash, bank and discount. It is mostly used by those organisations that have large operations and conduct transactions in both cash and through banks while also giving discounts. The process of recording transactions is similar to a double-column cash book; the cash and bank columns are totalled periodically while the bank column is just totalled. The discount given to creditors is recorded on the debit side, while the discount received from creditors is recorded on the credit side.

  • Petty Cash Book:

A Petty Cash book is used to record transactions that are not of very high value to the business. There is an opening credit balance, which is the amount put aside for petty cash expenses. Transactions relating to stationery, postage and stamps, daily wages, etc., are recorded in the petty cash book. 

Question 13. Prepare double column cash book from the following transactions for the year August 2017:

01 Cash in hand 17,500

      Cash at bank 5,000

03 Purchased goods for cash 3,000

05 Received cheque from Jasmeet 10,000

08 Sold goods for cash 7,000

10 Jasmeet’s cheque deposited into bank

12 Purchased goods and paid by cheque 20,000

15 Paid establishment expenses through bank 1,000

18 Cash sales 7,000

20 Deposited into bank 10,000

24 Paid trade expenses 500

27 Received commission by cheque 6,000

29 Paid Rent 2,000

30 Withdrew cash for personal use 1,200

31 Salary paid 6,000

Answer 13:                                                                    Cash Book                                                              

Dr.                                                                                                                                                                                  Cr.

Date Receipts L.F. Cash


Date Payments L.F. Cash


2017 2017
01 Dec Balance b/d 17,500 5,000 03 Dec Purchases 3,000
05 Dec Jasmeet 10,000 10 Dec Bank C 10,000
08 Dec Sales 7,000 12 Dec Purchases 20,000
10 Dec Cash C 10,000 15 Dec Establishment Expenses 1,000
18 Dec Sales 7,000 20 Dec Bank C 10,000
20 Dec Cash C 10,000 24 Dec Trade Expenses 500
27 Dec Commission 6,000 29 Dec Rent 2,000
30 Dec Drawings 1,200
31 Dec Salaries 6,000
31 Dec Balance c/d 8,800 10,000
41,500 31,000 41,500 31,000

Benefits of Solving Cash Book Class 11 Extra Questions

Accountancy can appear to be difficult at first, but with the proper understanding and practice, students can find this subject quite interesting when it comes to solving numerical questions. When students have a good hold over passing journal entries and posting them into ledger accounts, then subsequent  chapters would not feel difficult at all. Solving important questions Class 11 Accountancy Chapter 4 will help students get that confidence in passing journal entries, recording them in special purpose books and then finally posting them into ledgers.

 Following are the benefits of solving Important Questions Class 11 Accountancy Chapter 4:

  1. Practising important questions from chapter 4 in Accountancy will help students ace their examinations and get better results.
  2. The step-by-step solutions are prepared by subject matter experts with years of experience to provide  credible study material based on the NCERT books which is complete in every way and students need not look elsewhere for any other resources.  Hence, students can rely upon and trust these solutions completely.
  3. The important questions are prepared  keeping  in mind the CBSE syllabus and guidelines, which can give a  thorough  revision of the entire chapter. These resources  are reliable and accurate. In fact these resources are the best study material for getting a 100% score and creating your first milestone in  high school. 
  4. That’s not enough, many questions in the competitive exams are taken from NCERT books so these resources are definitely going to pay you in the long run. Practice, practice and practice. Practicing from the Important Questions Class 11 Accountancy Chapter 4 will speed up your learning and revision from various sample papers will boost their performance naturally and effortlessly. 

Extramarks provides a repository of   credible resources such as NCERT textbooks, NCERT revision notes, CBSE sample papers, CBSE past year question papers, CBSE extra questions, and CBSE mock examinations. In order to access these resources, students can click on the URLs mentioned below:

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Q.1 Prepare a petty Cash Book on the Imprest System from the following:

Jan. 1 Received for petty cash 1,000
Jan. 2 Paid bus fare 5.00
Jan. 2 Paid Cartage 25.00
Jan. 3 Paid for Postage and telegrams 50.00
Jan. 3 Paid wages for casual laborers 60.00
Jan. 4 Paid for stationery 40.00
Jan. 4 Paid tonga charges 20,00
Jan. 5 Paid for repairs to chairs 150.00
Jan. 5 Bus fare 10.00
Jan. 6 Cartage 40.00
Jan. 6 Postage and telegrams 70.00
Jan. 6 Tonga Charges 30.00
Jan. 6 Cartage 30.00
Jan. 6 Stationery 20.00
Jan. 6 Refreshment to Customers 50.00



Date Particulars Total Conveyance Cartage Stationery Postage Wages Misc.
1 To Cash 1,000
2 By Conveyance 5 5
2 By Cartage 25 25
3 By Postage & Telegrams 50 50
3 By wages 60 60
4 By Stationery 40 40
4 By Conveyance 20 20
5 By Repairs of Furniture 150 150
5 By Convenience 10 10
6 By Cartage 40 40
6 By Postage & Telegrams 70 70
6 By Conveyance 30 30
6 By Cartage 30 30
6 By Stationery 20 20
6 By General Expenses 50 50
31 Total exp. 600 65 95 60 120 60 200
31 By Balance c/d 400
Feb.1 By Balance b/d 400
To Cash 600
By Balance c/d 1,000


Q.2 Why is the cash book called a journal as well as ledger


All transactions are primarily recorded in the cash book and therefore, it is called a journal. Cash book is just similar to a cash account and therefore, it is called a ledger.


Enter the following transactions in a Single Column Cash book:

Jun 1 Cash in Hand 1,00,000
Jun 5 Cash Purchases of 20,000 plus CGST and CGST @ 6% each
Jun 8 Cash Sales of 16,000 plus CGST and SGST @ 6% each
Jun 10 Received cash from Max 20,000
Jun 15 Purchased Furniture for 10,000 plus CGST and SGST @ 6% each
Jun 22 Paid Wages 4,000
Jun 25 Received commission 2,000 plus CGST and SGST @ 6% each
Jun 30 Paid rent 12,000 plus CGST and SGST @ 6% each



Cash Book
Dt. Particulars L.F. Dt. Particulars L.F.
Jun 1 To Balance b/d 1,00,000 Jun 5 By purchase A/c 20,000
8 To Sales 16,000 5 By Input CGST A/c 1,200
8 To Output CGST A/c 960 5 By Input SGST 1,200
8 To Output SGST A/c 960 15 By Furniture A/c 10,000
10 To Max 20,000 15 By Input CGST A/c 600
25 To Commission Rec. A/c 2,000 15 By Input SGST A/c 600
25 To Output CGST A/c 120 22 By Wages A/c 4,000
25 To Output SGST A/c 120 30 By Rent A/c 6,000
30 By Input CGST A/c 360
30 By Input SGST A/c 360
30 By Balance c/d 89,120
1,40,160 1,40,160

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FAQs (Frequently Asked Questions)

1. What are the topics covered in Chapter 4 in Accountancy?

The topics that are covered in Chapter 4 Recording of Transaction-II are as follows:

  1. Cash Book
  2. Single Column Cash Book
  3. Posting of the Double Column Cash Book
  4. Petty Cash Book
  5. Posting from the Petty Cash Book
  6. Conveyance Account
  7. Balancing of Cash Book
  8. Sales Account
  9. Purchases Account

2. How can one score good grades in Accountancy?

To score good grades in Accountancy, firstly, students should be thorough with the key concepts of the chapters, and secondly, they should consistently practice the questions from NCERT books, reference books and past years’ papers. In case students want to practice with additional study material to check their preparation, they  can access Accountancy Class 11 Chapter 4 Important Questions from the Extramarks website to ensure 100% score in the exam results. Trust Extramarks , it is one stop solution to all your problems.