Glossary
What is a contra entry?
What a contra entry means, why it changes no income or expense, and how cash deposits and withdrawals are recorded without a contra voucher.
Updated
In short
A contra entry records money moving between a business's own cash and bank accounts, such as a deposit or withdrawal. In SimpleERP it is a Quick transfer in Cash and bank, which posts the journal.
A contra entry records money moving between two of the business's own cash or bank accounts, such as cash deposited into the bank, cash withdrawn for the till, or a transfer between two bank accounts. Both sides are cash or bank, so no income, expense, customer or supplier is touched. Tally records it with a contra voucher.
Contra entry: a worked example
On 7 October 2026 Lakshmi Steel Furnitures deposits ₹40,000 of the week's cash sales into its HDFC current account, and on 9 October withdraws ₹10,000 for petty cash.
| Date | Account | Debit | Credit |
|---|---|---|---|
| 7 Oct 2026 | Bank (HDFC) | ₹40,000 | |
| 7 Oct 2026 | Cash | ₹40,000 | |
| 9 Oct 2026 | Petty cash | ₹10,000 | |
| 9 Oct 2026 | Bank (HDFC) | ₹10,000 |
FAQ
Questions, answered
Why is it called a contra entry?
Both sides of the entry sit in the cash and bank books, so in a two-column cash book the same amount appears on the debit side of one column and the credit side of the other. Contra means against, and the entry is marked C in the cash book.
Is a cheque from a customer a contra entry?
No. Money from a customer is a receipt, because it reduces what the customer owes. A contra entry only moves money between your own cash and bank accounts. In SimpleERP record the customer's cheque as a payment received against their invoices.
How do I record a cash deposit in SimpleERP?
Open Accounting, then Cash and bank, and use Quick transfer: from Cash, to your bank account, the amount and the date. It posts a balanced journal and both registers show the movement with a running balance.
Does a contra entry affect profit?
No. Cash and bank are both assets, so moving money between them changes neither income nor expense. Total cash and bank stays the same; only the split between the till and the account changes.
Related
Keep reading
Voucher (Tally term)
The numbered record of one transaction, such as a sale, payment, receipt or journal, that posts a balanced debit and credit.
Read morePetty cash
A small cash float for minor expenses, recorded spend by spend and topped up from the bank.
Read moreAccounting
A double-entry ledger with journals, bank registers, statements and a lock date.
Read more
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