CASH
BOOK
In business most of the transactions relate to receipt of
cash, payments of cash, sale of goods and purchase of goods. So it is
convenient to have separate books for each, such class of transaction, one for receipts
and payments of cash, one for purchase of goods and one for sale of goods. These
books are called subsidiary books.
Cash book is a subsidiary book with records the receipts
and payment of cash. With the help of cash book and bank balance can bank balance
can be checked at my point of time.
TYPES OF CASH BOOK
Cash book can be of four types:
1.
Simple cash book.
2.
Two column cash book.
3.
Three column cash book.
4.
Petty cash book.
1 SIMPLE CASH BOOK
A simple cash book is prepared like any ordinary account. The
receipt are recorded in the DR. side and the payment are recorded in the CR. Side
of the cash book. The specimen Performa of a simple cash book.
Format of simple cash book
DR.
CR.
Date
|
particular
|
LF.
|
Amount
|
Date
|
Particular
|
LF.
|
Amount
|
Preparation of simple cash book.
Cash book is in a way, a cash account with debit and credit
side and cash account is an asset account, so the rule followed is increase in
assets to be debited and decrease in asset is to be credited. This implies that
cash book is a book where all the receipts in terms of cash are recorded on its
credit side. This means cash book records all transactions related to receipts
and payments in terms of cash only. On the debit side in the particulars
column, the name of the account, for which cash.
Illustration
Enter the following transactions in the cash book of m/s.
ABC traders:
Date details amount
December 01 cash
in hand 27,500
December 05 cash
received from Nitu 12,000
December 08 insurance
premium paid 2,000
December 10 furniture
purchase 6,000
December 14 sold
goods for cash 16,500
December 18 purchase
goods for cash from naresh 26,000
Books of M/S ABC
traders
Cash book
DR. CR.
DATE
|
PARTICULAR
|
AMOUNT
|
DATE
|
PARTICULAR
|
AMOUNT
|
DEC 1
|
TO Balance b/fd
|
27500
|
DEC 08
|
By insurance premium
|
2000
|
DEC 05
|
To nitu a/c
|
12000
|
DEC 10
|
By furniture
|
6000
|
DE4C 14
|
To sale
|
16500
|
DEC 18
|
By purchase
|
26000
|
Total
|
Total
|
2 two column cash book
A two- column cash book records discount allowed and
discount received along with the cash payments and cash receipts. Discount allowed
is the concession given by the business man to its customers or debtors. It is
a gain or profit for the firm so it is to be credited and recorded in the CR. Side
of the cash book.
3 THREE COLUMN CASH BOOK
A three column cash book is a cash book which contains bank
column along with cash and discount columns. A firm normally keeps the bulk of
its funds at a bank; money can be deposited and withdrawn at will if it is a
current account. Probably payments into and out of the bank will be more
numerous than strict cash transactions. They in only a little difference
between cash in hand and cash at bank.
www.indianfastival.ooo
CASH BOOK
Reviewed by Sonu Singh
on
September 11, 2018
Rating:
Reviewed by Sonu Singh
on
September 11, 2018
Rating:
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