CASH BOOK

BWU/BBL/19/034

 DEFINITION- PRINCE KUMAR

CASH BOOK- the cash book is used to

record receipts and payments of cash.it works as a book of
original entry as well as a ledger account. The entries related
to recipt and payment of cash are first recorded in the cash
book and then posted to the relevant ledger
accounts.moreover,a cash book is a substitute for cash
account in the ledger.a company that properly maintains a
cash book does not need to open a cash accounts in its ledger.

 Types of cash book:-

There are four major types of cash book that companies
usually maintain to account for their cas flows.these are given
below:

1. A single column cash book to record only cash

transactions.
2. A double/two column cash book to record cash as well
as bank transactions.
3. A triple/three column cash book to record cash.bank and
purchase discount and sales discount.
4. A petty cash book to record small day to day cash
expenditures.
 USES:-
A cash book is set up as a subsidiary to the general ledger in
which all cash transactions made during an accounting. Period
are recorded in chronological order. Larger organizations usually
divide the cash book into two parts: the cash disbursement
journal which records all cash payments, and the cash received
into the business. the cash disbursement journal would include
items such as payments made to vendors to reduce accounts
payable, and the cash receipts journal would include items such
as payment made by costombers on outstanding accounts
receivable or cash sales.

 EXPLANATION:-

The double column cash book has two money columns

on both debit and credit sides-one to record cash
transactions and one to record bank transactions. in
other words, we can say of a single column cash book
column to both sides of a single column cash book, it
would become a double column cash book. The cash
column is used become a double column cash book.the
cash column is used to record all cash transactions and
works as a cash account ehere as bank column is used
to record all receipts and payments made by checks
and works as a book account. Both the column are
totaled and balanced like a traditional T-account at the
end of an appropriate period which is usually one
 month. Since a double column cash book provides cash
as well as bank balance at the end of a period, some
organizations prefer to maintain a double column cash
book rather than maintaining two separate ledger
accounts for recording cash and bank transactions.

 EXAMPLES:-
The Edward company uses a double column cash book to
record its cash and bank related transactions. It engaged in
the following transactions during the month of October 2019:

 1-10=) opening balance-cash-₹10,000/bank(cr.)-₹5000.

 3-10=) further capital invest-cash ₹2000.
Bank-₹3000.
 5-10=) cash purchase made ₹2000.
 7-10=) cash sales made ₹40,000.
 9.10=) credit sales made ₹45,000 to Mr.x.
 15-10=) cash deposited into bank ₹500.
 13-10=) cash withdrawn from bank ₹150.
 20-10=) cheque received from Mr.x.
 25-10=) business expenses paid ₹1500.by cash ₹1000 by
cheque.
 CASH BOOK(DOUBLE COLUMN)

DATE PARTICU L/ V/ CAS BA DATE PARTICU L/ V/ CA BA

LAR F N H NK LAR F N SH NK
9/10/ to 10,0 - By - 500
19 balance 00 balance 0
b/d b/d
03/10 To 200 300 200 -
/19 Capital 0 0 0
a/c
07/10 To sales 40,0 - c 500 -
/19 a/c 00
15/10 To cash c 500 17/10 By cash c - 150
/19 a/c /19 a/c
13/10 To bank c 150 - 25/10 By 150 100
/19 a/c /19 business 0 0
a/c
20/10 MR.X - 45, 30/10 By 48, 42,
/19 a/c 000 /19 balance 150 350
c/d
52,1 48,5 52,1 48,5
50 00 50 00