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LECTURE NOTES

XI ENTREPRENEURSHIP

CODE-241506010112

TOPIC-BUSINESS FINANCE AND ARITHMETIC

SUB TOPIC- INTRODUCTION TO ACCOUNTING AND CASH REGISTER

1. American Institute of Certified Public Accountants (AICPA) define accounting as, "
accounting is the art of recording, classifying and summarizing in a significant manner

and in terms of money, transactions and events which are in part at least , of a financial
character and interpreting the results thereof".
2. A notebook in which we write to keep track of all the daily transactions which happens
in the business is called as the Cash register.
3. Importance of maintaining cash book:
(i) Without the entries from the cash book, no further analysis of expenses, costs,
revenues, profits, etc, can be made.
(ii) It helps in easy computation of cash in hand.
4. Inflow and Outflow of cash:
Inflow of cash:
(i) Owners' equity

(ii) Loan received
(iii) Sales receipts
(iv) Interest earned
Outflow of cash:
(i) Land purchased
(ii) Building constructed
(iii) Computer purchased
(iv) Raw materials purchased

5. Generic Formats of Cash Register:
A cash register can be maintained in two formats:
(i) Cash register with cash column only (single column cash book

Format of Cash Register with Cash column only

Date Description Ref. No. Cash Cash Paid Cash Balance
(Voucher/Bill) Received