Double Entry System: Five Finger Rule and Accounting Vouchers (For CBSE, ICSE, IAS, NET, NRA 2022)

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Double Entry System - Five Finger Rule

To report the transactions, the accountant should be aware about the five-finger rule for recording the entries in the respective places in the books of accounts. This is popularly known as Five Finger Rule, are as follows:

Five Finger Rule of Transactions

Note: Assets and expenses are always to be Debited Liabilities, Capital and Revenues are always to be credited.

Accounting Vouchers

Accounting vouchers are basically classified as cash and non-cash vouchers. The cash vouchers are of two types, such as; Debit and Credit Voucher and the non-cash voucher are called as Transfer Voucher.

Types of Accounting Vouchers

Cash Voucher

Debit Voucher

Debit Vouchers are prepared to record the cash payments only in the books of accounts. Mostly the cash payment to creditors, Purchase of assets, Repayment of loans and cash deposits into the bank account is also recorded in the books of accounts by the accountants who are in-charge of the accounts department. All these transactions are recorded in the specified form made by the organisation from time to time.

Debit Voucher

Credit Voucher

Credit Vouchers are prepared to record the transactions which involves only cash receipts, such as; cash sales of assets, cash withdrawn from banks, revenue incomes and loan taken in advance etc. Both the debit and the credit voucher specimen formats are given below for the reference.

Credit Voucher

Non-Cash Voucher

Transfer Voucher

Transfer vouchers are the vouchers which prepared for transactions which not involves cash. It basically records the transactions which involves credit sales, credit purchases, depreciation on assets, return of goods purchased on credits etc.

Transfer Voucher

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