I'm just learning bookkeeping with an online course and after having finally got to grips with the credits and debits, I'm a bit confused in dealing with cash going into the bank.
My spreadsheet exercise requires that the cash from the sales that day is paid into the bank, so I have £300 to pay into the bank.
The spreadsheet has two columns in debit (cash and bank) and two columns in credit (cash and bank). And there is a "bank deposit" entry of either side required.
But if I have £300 in the cash debit column surely I just put -300 in that and +300 in the bank debit column? The balance of money available is still the same, but as I'm paying in £300 to the bank, then it remains on the debit side.
That is what my confused logic suggests is correct. But then why is there a bank deposit section on the credit side?
I've attached a spreadsheet - would be grateful for some explanation - I'm very confused!
It's asking you to deposit £300 cash into the bank, so I think only two entries are required, a credit of £300 in the cash column where it says Bank deposit and a debit of £300 in the bank column where it says Bank deposit. In other words you're taking the money out of the cash account and putting it into the bank.
Thanks for your reply. The problem I see with the example you have is that the total of the cash/bank debits column is increased by £300, and on the credits side it implies that the £300 has been paid out. (paid out of the bank goes in the credit side, payments received on the debits side).
On the debits side, there is a total of £9600 income, so by just putting -300 in C9 and +300 in D9 still gives the total as £9600 income, it's just that £300 has been moved from cash to bank.
That's it. There is no extra income, your over all balance(cash&bank together) should not change. You only have to move money from one a/c to the other... You DON'T use negative numbers (no -300) in duble entry. So yes CR cash £300 and Dr bank £300.
