Page 97 - DMGT104_FINANCIAL_ACCOUNTING

Unit 6: Subsidiary Books

dual role. It is a book of prime entry and also serves the purpose of a Cash Account. It is designed Notes
in the form of a ledger account and records cash receipts on the debit side and payments on credit
side. It is also balanced in the same way. Hence, when cash book is maintained, there is no need
to have a Cash Account in the ledger.

Kinds of Cash Book

There are different types of cash books maintained by the business. They are:
1. Simple or Single Column Cash Book

2. Two or Double Column Cash Book
3. Three or Triple Column Cash Book
4. Petty Cash Book
We shall now consider them one by one and learn how they are prepared and posted into ledger.

6.2.1 Single Column Cash Book

Look at the pro forma of a Single Column Cash Book shown below. Doesn’t it look like a ledger
account? Yes, it does. In fact a Single Column Cash Book is nothing but a Cash Account. It is used
for recording all cash receipts and cash payments and serves the purpose of Cash Account
as well. It is called Single Column Cash Book just because it has only one amount column on
each side.
Dr. Cr.
Date Particulars L.F. Amount Date Particulars L.F. Amount
(Receipts) ( ) (Payments) ( )

Notes
1. c/d stands for Carried Down whereas b/d stands for Brought Down.
2. One thing which is very important to remember while recording a transaction in
the Cash Book is that no distinction is adopted about capital or revenue nature of
transactions i.e., all the transactions are recorded in the Cash Book.

Recording in Single Column Cash Book

You know that Cash Account is a real account. According to rules, Cash Account is to be debited
when cash is received and credited when cash is paid. Hence, the debit side of the cash book is
used for recording all cash receipts and the credit side for all cash payments. Let us now discuss
how entries are made in this book.
As explained above, whenever cash is received, it is to be recorded on the debit side. The date on
which it is received is recorded in the date column. The name of the account from which it is
received is mentioned in the particulars column. In the L.F. (Ledger Folio) column the page
number of the account in the ledger, where the posting is made, is to be recorded at the time of

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