Explanation

The sale of an asset is recorded in the Asset Account and not in the Sales book (which pertains to sale of goods). Statement A. is false. Total of Return Outwards book (being purchase return) has a credit balance. The total is transferred at the end of the period to the credit of the Purchase Account and not debited to Return Outwards Account. Statement B. is false. The balance of Petty Cash book is not a liability, it is an asset as it is the balance of cash left with the petty cashier. Statement C. is incorrect. Cash Book is both a subsidiary book or book of original entry where all cash transactions are directly recorded and a ledger, it plays the role as a Cash Account (a ledger). Hence statement D. is true.