Cash Book Examples

Top 2 Practical Examples of Cash Book Entries

The following Cash Book examples provide an outline of the most common Cash Books. Cashbook is a financial journal which contains all the cash receipt and cash payments including the deposit in bank and withdrawal from the bank. Here all transactions have the two sides, i.e., debit and credit. All the receipts in cash record on the left side of the cash book entries, whereas all the payments in cash record on the right side. The difference between the sum of balances of the right side and the left side shows the cash on hand. There are various examples of the Cash Book entries followed according to the different situations by different companies. In this article, we take two types of examples of cash book – Single Column and Double Column

Top 2 Practical Examples of Cash Book Entries

Some of the examples of Cash Book entries are shown below in different situations:

Example #1 – Single Column

Under a single column cash-book, only cash transactions done by the business record. It has only a single money column on debit and credits both sides, is titled as “amount.” As it records only the accounting transaction related to cash so entries which involve banks or discounts such as checks received, checks issued, sales discount or purchases discount do not record.

For example:

Mr. Y started the business with the capital of $ 50,000 on April 1, 2019. Out of the capital invested, $ 20,000 is deposited in the bank account on the same day. On April 19, he identified the following transactions. Prepare the necessary single column Cash-book using the data as given below:

Solution

Example #2 – Double Column

The transactions done on credit do not record in the cash book. So the transactions Purchase from Mr. X on credit and Goods sold on credit on 18 April are not considered while preparing the cash book entries.

In the present modern world, almost all transactions done are using the bank account of the company. So, it was required to present one more column to the single-column cash-book. For this double column cash – the book is used. Under double-column cash-book, not only cash transactions but transactions through banks done by the business also record.

For example:

Mr. X runs a business.  On April 19, the following transactions took place in the business. Prepare the necessary double-column Cash-book using the data as given below:

Solution

The transactions which are done on credit are not recorded while preparing the double column cash –book. In the case of double column cash- book, cash column records all the transactions relating to cash so, it works as the cash accounts and the bank column records all the transactions pertaining to bank such as checks received, checks issued, etc. so, it works as the bank accounts.

Conclusion

Cashbook is prepared like a ledger where the company’s cash transactions are recorded and entered according to date. It is a book containing the original entry and the final entry, which means that the cash book serves as the general ledger. In the case of a cash book, there is no requirement of balance transfer to the general ledger, which is required in the case of the cash account. Entries in cash book are posted then to the corresponding general ledger.

Recommended Articles

This article has been a guide to Cash Book Examples. Here we discuss various examples of the cash book entries (single column and double column) along with a detailed explanation. You can learn more about financing from the following articles –

• Petty Cash
• Cash Equivalents Meaning
• Cash Flow Statements Purpose
• Cash Receipt Meaning
• Rules for Journal Entries