Single Column Cash Book¶
The Single Column Cash Book is a basic type of cash book used to record all cash transactions of a business. It functions similarly to a ledger account, meaning there is no need to open a separate cash account in the ledger. The balance from the cash book is directly posted to the trial balance at the end of the accounting period.
Since the cash book represents a real account, the following accounting rule is applied: - Debit: What comes in (cash received). - Credit: What goes out (cash paid).
Key Features:¶
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Cash Transactions Only: The single column cash book is used to record only cash transactions, such as cash receipts, payments, and expenses.
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Debit Side: All cash received by the business is posted on the debit side of the cash book.
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Credit Side: All cash payments and expenses incurred by the business are posted on the credit side of the cash book.
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No Separate Cash Account: As the cash book itself functions as the cash account, there is no need to maintain a separate cash account in the ledger.
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Posting to Trial Balance: The closing balance of the cash book is posted directly to the trial balance, reflecting the cash in hand at the end of the period.
Accounting Rule for the Single Column Cash Book:¶
Since the cash account is categorized as a real account, the following rule is followed when recording transactions: - Debit what comes in (e.g., cash received from sales). - Credit what goes out (e.g., payments made for expenses).
Format¶
Conclusion:¶
The Single Column Cash Book simplifies the process of tracking cash transactions by serving as both a cash record and a ledger account. It provides a clear view of all cash inflows and outflows, with the balance directly posted to the trial balance. This ensures that the business has an accurate record of its cash position without the need for additional ledger entries.
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