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Difficulty: MediumCash and Bank Summary Analysis for Missing Cash Receipts and Payments

Chief Okafor runs a retail store and maintains single-entry records. For the accounting year ended 31 December 2025, his cash transactions were summarized as follows:
- Opening cash balance: N25,000\text{N}25,000
- Cash received from debtors: N340,000\text{N}340,000
- Cash sales: N275,000\text{N}275,000
- Cash banked (paid into bank): N410,000\text{N}410,000
- General business expenses paid in cash: N85,000\text{N}85,000
- Cash wages paid: N60,000\text{N}60,000
- Closing cash balance: N18,000\text{N}18,000

Based on the cash summary analysis, what is the total amount of cash withdrawn by the proprietor for personal drawings during the year?

Answer: 67000 Naira

Answer

The total amount of cash withdrawn by the proprietor for personal drawings is N67,000\text{N}67,000.
In single-entry accounting, a cash summary account is constructed to find missing cash transactions. Total cash inflows (opening cash N25,000\text{N}25,000 + receipts from debtors N340,000\text{N}340,000 + cash sales N275,000\text{N}275,000) amount to N640,000\text{N}640,000. Known cash payments and closing balance (cash banked N410,000\text{N}410,000 + general expenses N85,000\text{N}85,000 + wages N60,000\text{N}60,000 + closing balance N18,000\text{N}18,000) total N573,000\text{N}573,000. The balancing figure of N67,000\text{N}67,000 represents cash withdrawn by the proprietor for personal use.

Step-by-Step Solution

1
Sum all cash receipts and the opening balance to get total cash available on the debit side.
Total debit side = N25,000+N340,000+N275,000=N640,000\text{N}25,000 + \text{N}340,000 + \text{N}275,000 = \text{N}640,000.
The cash summary debit side records initial cash on hand plus all cash receipts during the accounting period.
2
Sum all documented cash payments and the unspent closing cash balance on the credit side.
Total accounted outflows and closing balance = N410,000+N85,000+N60,000+N18,000=N573,000\text{N}410,000 + \text{N}85,000 + \text{N}60,000 + \text{N}18,000 = \text{N}573,000.
The credit side of the cash summary lists disbursements (including cash banked) and remaining cash.
3
Deduct total accounted disbursements from total receipts to calculate the missing drawings figure.
Drawings = N640,000−N573,000=N67,000\text{N}640,000 - \text{N}573,000 = \text{N}67,000.
Any unexplained deficit on the credit side of a cash summary in single-entry bookkeeping represents unrecorded cash drawings by the owner.

Key Concept

Cash Summary Analysis for Missing Figures
Estimated Time:1m 30s
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Cash and Bank Summary Analysis for Missing Cash Receipts and Payments

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