Q.From the following transactions of Kavya Traders for August 2026, prepare the Double Column (Cash and Discount) Cash Book, and state the amounts to be posted to Discount Allowed Account and Discount Received Account:
Aug 1 — Cash in hand ₹5,000.
Aug 6 — Received from Kumar Stores ₹4,750 in full settlement of ₹5,000 due.
Aug 14 — Paid to Ramesh & Co. ₹3,800 in full settlement of ₹4,000 due.
Aug 20 — Cash sales ₹6,000.

A two-column (double-column) cash book records both cash and bank transactions.

A simple cash book has only one amount column and records cash transactions only. A two-column (double-column) cash book adds a second amount column for the bank so that both cash receipts/payments and bank receipts/payments (deposits, cheques issued and received) are recorded together in the same book, side by side. It does not record ALL transactions (credit transactions involving no immediate cash/bank movement are recorded in the journal/subsidiary books instead), and it is not restricted to only cash or only credit transactions.

Cash purchases of goods are recorded in the Cash Book, not the Purchase Book.

The Purchase Book (Purchases Journal) is a subsidiary book used ONLY to record credit purchases of goods; a cash purchase, where payment is made immediately, is recorded as a cash payment in the Cash Book. The Sales Book and Purchase Return Book record credit sales and returns of purchased goods respectively, and so do not apply here either.

Credit-related transactions are not recorded in the cash book.

The cash book records only cash and bank transactions — receipts and payments of cash, and deposits/withdrawals/cheques through the bank. A credit transaction (where no cash or bank balance moves at the time, e.g. a credit sale or credit purchase) does not affect cash or bank immediately, so it is recorded in the Sales Book / Purchases Book / Journal instead, and only enters the cash book later when the amount is actually received or paid.