Page 102 - DCOM101_FINANCIAL_ACCOUNTING_I

Financial Accounting-I Sukhpreet Kaur, Lovely Professional University

Notes Unit 9: Cash Book

CONTENTS

Objectives
Introduction
9.1 Single Column Cash Book
9.2 Double Column Cash Book
9.3 Three Column Cash Book

9.4 Petty Cash Book
9.5 Summary
9.6 Keywords
9.7 Self Assessment

9.8 Review Questions
9.9 Further Readings

Objectives

After studying this unit, you will be able to:
z Prepare single column cash book
z Construct double and triple column cash books

z Prepare petty cash book

Introduction

Cash book is the book of accounts where most of the transactions are generally related with the
receipts and payment of cash. It may be either purchase of goods for cash or sale of goods for cash
or it may be either payment of expenses or receipts of income. All such transactions are recorded
separately in a book, which is known as the cash book. This book is helpful in telling the accurate
balance of cash in hand or at bank. All cash transactions are directly entered into the cash book
and on the basis of cash book, ledger accounts are prepared.
Generally, four types of cash book are prepared. These are:

1. Single column cash book
2. Double columns cash book
3. Three columns cash book
4. Petty Cash Book

9.1 Single Column Cash Book

It is a book that generally records the transactions into two classification, viz Payments and
Receipts. The receipts and payments are recorded in the debit and credit side of the cash book

respectively. The debit and credit side transactions of the cash book are prefixed with “To” and
“By” respectively.

96 LOVELY PROFESSIONAL UNIVERSITY