Prepare a double column cash book with the help of following information for December 2016:

01  Started business with cash  1,20,000  03  Cash paid into bank  50,000  05  Purchased goods from Sushmita  20,000  06  Sold goods to Dinker and received a cheque  20,000  10  Paid to Sushmita cash  20,000  14  Cheque received on December 06, 2010, deposited into bank    18  Sold goods to Rani  12,000  20  Cartage paid in cash  500  22  Received cash from Rani  12,000  27  Commission received  5,000  30  Drew cash for personal use  2,000  Solution: Cash Book  Dr.                  Cr.  Date  Particulars  LF  Cash  Bank  Date  Particulars  LF  Cash  Bank  2016          2016          Dec.01  Capital    1,20,000    Dec. 03  Bank  C  50,000    Dec.03  Cash  C    50,000  Dec. 10  Sushmita    20,000    Dec.06  Dinker    20,000    Dec. 14  Bank  C  20,000    Dec.14  Cash  C    20,000  Dec. 20  Cartage    500    Dec.22  Rani    12,000    Dec. 30  Drawings  C  2,000    Dec.27  Commission    5,000    Dec. 31  Balance c/d    64,500  70,000                            1,57,000  70,000        1,57,000  70,000                        Explanation:  1. December 03, 2010: Cash paid into bank  Particulars: Cash paid into the bank.  Contra Entry Explanation:  Credit (C): Decrease in the cash account (₹50,000 is credited to the cash account).  Debit (D): Increase in the bank account (₹50,000 is debited to the bank account).  Purpose: Reflects the movement of cash from the cash account to the bank account.  2. December 06, 2010: Cheque received and deposited into bank  Particulars: Cheque received on December 06, 2010, deposited into the bank.  Contra Entry Explanation:  Credit (C): No impact on the cash account (since the cheque is received and not paid in cash).  Debit (D): Increase in the bank account (reflects the amount of the cheque deposited into the bank).  Purpose: Illustrates the banking transaction involving a cheque.