Prepare Double column Cash Book for the following transactions:
1) Dividend collected by bank- 1,200
(And please explain the meaning of 'Dividend' here.)
The journal entry for this transaction is as follows:
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Date | Particulars | L.F. | Debit Amount (Rs) | Credit Amount (Rs) | |
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| Bank A/c |
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| To Dividend A/c |
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| (dividend collected by bank) |
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Cash Book | |||||||||||
Dr. |
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Date | Particulars | L.F. | Cash (Rs) | Bank (Rs) | Date | Particulars | L.F. | Cash (Rs) | Bank (Rs) | ||
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| To Dividend |
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| XXX |
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| XXX | XXX |
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| XXX | XXX | ||
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Sometimes, banks are advised by account holders to make certain payments and collect certain receipts on their behalf. In this case, dividends are collected by bank. Dividends are the income from the investment in shares.