Page 2 - NOTES- CASH BOOK

100 Accountancy

4.1 Cash Book

Cash book is a book in which all transactions relating to cash receipts and cash
payments are recorded. It starts with the cash or bank balances at the beginning
of the period. Generally, it is made on monthly basis. This is a very popular
book and is maintained by all organisations, big or small, profit or not-for-
profit. It serves the purpose of both journal as well as the ledger (cash) account.
It is also called the book of original entry. When a cashbook is maintained,
transactions of cash are not recorded in the journal, and no separate account
for cash or bank is required in the ledger.

4.1.1 Single Column Cash Book

The single column cash book records all cash transactions of the business in a
chronological order, i.e., it is a complete record of cash receipts and cash
payments. When all receipts and payments are made in cash by a business
organisation only, the cash book contains only one amount column on each
(debit and credit) side. The format of single column cash book is shown in
figure 4.1.
Cash Book
Dr. Cr.
Date Receipts L.F. Amount Date Payments L.F. Amount
Rs. Rs.

Fig. 4.1 : Format of single column cash book

Recording of entries in the single column cash book and its balancing is
illustrated by an example. Consider the following transactions of M/s Roopa
Traders observe how they are recorded in a single column cash book.

Date Details Amount
Rs.
2017
Nov. 01 Cash in hand 30,000
Nov. 04 Cash received from Gurmeet 12,000
Nov. 08 Insurance paid (Annual Instalment) 6,000
Nov. 13 Purchased furniture 13,800
Nov. 16 Sold goods for cash 28,000
Nov. 17 Purchased goods from Mudit in cash 17,400
Nov. 20 Purchase stationery 1,100
Nov. 24 Cash paid to Rukmani in full settlement of account 12,500

2018-19