Question -
Answer -
An entry that is recorded to reverse an entry on the opposite side of an account is called contra entry. For example when a debit entry gets recorded in an account, a contra entry will be posted in the credit side. Similarly a contra entry will be posted in debit side if an entry gets recorded in credit side.
Some transactions that can lead to contra entry are provided below.
1. Opening of a bank account
2. Depositing cash into bank
3. Withdrawal from bank
These transactions are recorded in a double column Cash Book as shown below.
| Cash Book |
| Dr. | | | | | | | | | Cr. |
| Date | Particulars | L.F. | Cash ₹ | Bank ₹ | Date | Particulars | L.F. | Cash ₹ | Bank ₹ |
| Cash | (C) | | | | Bank | (C) | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |