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CASH BOOK
PREVIEW
- Meaning of Cash Book
- Types of Cash Book: Single Column cash book, Double Column Cash Book.
- Items on a column cash book: Cash column, Bank Column and discount column
- Preparation of Cash Book
Meaning of Cash Book
A Cash book is a book of account for recording cash receipts and cash payments. A Cash Book is one of the most important books of account. It is used only for recording cash transaction. A cash book, apart from the ledger is also a book of original entry.
Rules for Making Entries in the Cash Book
When making entries in the cash book, the following rules should be followed:
- Enter all cash received on the debit side of the cash book.
- Enter all cash paid out on the credit side of the cash book.
- Enter the name of the receiver and the payer in the particular’s column
Types of Cash Book
There are three types of Cash Book
- Single Column Cash Book
- Double Column Cash Book
- Three-Column Cash Book
We shall discuss each of these in detail:
Single Column Cash Book
The single Column Cash Book is drawn as follows: The single cash book has only a single column on the debit side for cash receipts and another on the credit side for cash payments.
The format of a single cash book;
Dr Cr
| Date | Particulars | Folio | Amount | Date | Particulars | Folio | Amount |
It can be seen that Cash Book is divided into two equal parts, namely: the Debit side and the Credit side.
An Example is given below:
Mr. Akubo commenced business as a petty trade in Lagos, on 1st of March, 2011 with N8000 in cash. During the month, the following transactions took place: N
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