A petty cash book is a record of smallvalue purchases before they are later transferred to the ledger and final accounts. In business firm most of the payments are received and paid by cheque. A two column cash book is one in which there are two columns on each side. This third column is used for recording the cash discounts allowed to debtors and the cash discounts received from creditors. The term cash discount refers to the allowance given for quick payment. Cash book also serves the purpose of book of original entry as well as ledger. On april 1, 2017, hassan sajjad store cash book showed debit balances of cash rs. The cash and bank columns of triple column cash book are used as accounts and are periodically totaled and balanced just like in case of a double column cash. The receipts are recorded in the dr side and the payments are recorded in the cr side of the cash book. The illustration below shows the basic format of a three column cash book, which includes the discount columns. The single column cash book also known as simple cash book is a cash book that is used to record only cash transactions of a business. Read this article to learn about the following types of cash book and its preparation, i. Mar 02, 2020 the three column cash book also known as triple column cash book has three money columns on both debit and credit side one on each side for recording discount, cash and bank amounts.
This type of cash book usually uses the imprest system. Dec 06, 2019 cash book the cash book is a ledger in the sense that it is designed in the form of a cash account and records cash receipts on the debit side and cash payments on the credit side. It must be remembered that the discount column in treble column cash book is not an account. During the month of april following business was transacted. Cash book three column cash book practice the following problem will help you to understand that how to maintain record in three column cash book.
If cash discounts are allowed to customers or received from suppliers then discount columns are also added to the left of cash and bank columns. We have created two versions of the cash book template. A three column cash book includes three amount columns on both. Cash book with discount and cash column transaction. It is better for the firm if as customer pays their account quickly.
The total of the cash column on the debit side will always be greater than the total of the credit side because we cannot pay more cash than what we have received. Triplethree column cash book explanation, format, example. Free excel cash book template business accounting basics. Thus we see that a cash book is the mixture of journal and ledger. Simple cash book contains only one amount column on each side debit and credit for recording cash receipts and cash payments. The triple column cash book also referred to as three column cash book is the most exhaustive form of cash book which has three money columns on both receipt dr and payment cr sides to record transactions involving cash, bank and discounts. The cash book containing, two money columns cash column and bank column in both sides for recording cash and bank transactions, is called a double column cash book. Double column cash book or two column cash book shows two amount column in debit side and same column in credit site. A triple column cash book or three column cash book is one which consists of three separate columns on the debit side as well as credit side for recording cash, bank and discount. Triple column cash book l how to make sums for triple column cash book.
When a trader keeps a bank account it becomes necessary to record the. Three column cash book cash book with cash, discount. If a company uses a multicolumn purchases journal, which of. Threecolumn cash books and cash discounts springerlink. Jul 20, 2016 a three column cash book has an extra column for each side in addition to the two columns for bank and cash. Click here to download simple cash book excel template. Definition and explanation of cash book with examples. The three column cash book uses three columns on each side of the book. An entry in the other accounts column in a cash receipts journal could occur when the credit is to. This website uses cookies to deliver its services, to. This excel cash book is suitable for any small business that wants an easy bookkeeping method a simple way to track your income and expenses. If you can not find an all set made excel design template, then utilize the search box to type in what you are searching for and i am specific it will appear. A cash book is a financial journal that contains all cash receipts and payments, including bank deposits and withdrawals. What are the main advantages of maintaining cash book.
The totals of discount allowed and discount received columns from two sides of cash book are posted in discount allowed ac and discount received ac respectively in the ledger. The receipts of cash, cheque and cash discount allowed are entered on the debit side with their. If a business keeps a bank account and receipts and payments are frequently made through bank account than it is useful to maintain a three column cash book. Features of the cash book as both a ledger account and book of original entry 5. Threecolumn cash books and discounts igcse accounts. Cash book three column cash book practice you may also like to read.
Sometimes cash book is provided with an additional column of discount on each side. Three column cash book with all possible transactions. It may also be noted that when discount column is added with both sides of double column cash book it becomes a treble or three column cash book. One is used to record cash transactions, the second is used to record bank transactions and third is used to record discount received and paid. In triple column cash book here are three columns in the cash book because every businessman has a minimum of one current account in the bank.
Entries in the cash book are then posted into the general. Similarly, when cash is paid out the same is recorded on the credit or right hand side of the cash book. Aug, 2014 triple column cash book a cash book with discount and bank column is triple column cashbook. Double column cash book explained with example tutorstips. May 20, 2018 triple column cash book l how to make sums for triple column cash book in hindi l study mantra duration.
Treblethree column cash book definition, explanation. A three column cash book or treble column cash book is one in which there are three columns on each side debit and credit side. Interpret transactions and details in the cash book 12 g 1. This is the simplest form of cash book and is used in businesses where payments are made and received mostly in cash and where usually no cash discount is received or given. The three column cash book is simply the traditional twocolumn cash book with the addition of an extra column at each side. This is the simplest form of cash book and is used in businesses where payments are made and received mostly in. When cash is received it is entered on the debit or left hand side.
The discount column on the debit side of the cash book will record discounts allowed and that on the credit side discounts received. The double column cash book also known as two column cash book has two money columns on both debit and credit sides one to record cash transactions and one to record bank transactions. Also known as a two column cash book, a double column cash book is the one which has a bank column in addition to the regular cash column. Dec 17, 2019 the other side of the three column cash ledger book would be headed credit and show an identical format with the three columns representing the monetary amounts of the cash payment, bank payment, and discounts received. Petty cash book definition the petty cash book is defined as relatively small amount of cash kept at hand for making quick payments for miscellaneous small expenses in the business concern. A company uses a sales journal, cash receipts journal, purchases journal, cash payments journal, and a general journal. The cash on hand balance amount is displayed on the righthand side. Cash book is a book of original entry in which transactions relating only to cash receipts and payments are recorded in detail. The cash book is 100% free for you to download and use forever, and it is fully customizable so you can change anything in it. Thus in three column cash book, three columns for amount are provided on each side. The first row is for the company name and second for the title of the template.
Discount columns in both side are not balanced only totaled. The cash book is very widely use in every business, it is important to understand that how it is maintained in business concerns. Generally, it may not be possible to conduct business only on cash transactions. Definition and explanation of cash book format, advantages. At the end of the day or at the end of the period concerned, the amount columns on both sides are totaled. If a business keeps a bank account and receipts and payments are frequently made through bank account than it is useful to maintain a three column cash book rather than a single column cash book or a double column cash book. It is very identical to a traditional cash account in which all cash receipts are recorded on left hand debit side and all cash payments are recorded on right. All cash receipts and all bank deposits are recorded on the debit side and all cash payments and all payments through cheques are recorded on the credit side of this cash book. Explain the advantages of keeping cash in the bank 3. Good evening hs tutorial, pls how should one treat this following transactions in the cash book. The three column cashbook is sometimes referred to as the triple cash book, treble cash book or the 3 column cash book. Even staples couldnt come up with this simple 3 column account book, which i use instead of a check register much handier for tax time.
Cash book is an original entry book so we need to record full transaction but in the single column cash book, it is not possible to record properly of those. Triple column cash book explained with example tutorstips. Cash book definition, example and format of cash book. A three column cash book has an extra column for each side in addition to the two columns for bank and cash. The format of the cash book is also unique, in that the accounts for cash and bank stand side by side along with the discount column. Uses of petty cash book its a cash book used to enter daily petty expenses like cost of stationery, postage and xerox copy and so on. Single column cash book explanation, format and example. The specimen performa of a simple cash book is given as follows.
Cash and bank transactions can be recorded in cash book. This type of cash book is known as cash book with discount and cash column or two columns cash book. Mar 23, 2018 double column cash book has a two account column on both sides of the cash book. In other words, we can say that if we add a bank column to both sides of a single column cash. Double column cash book explanation, format, example. The three column cash book also known as triple column cash book has three money columns on both debit and credit side one on each side for recording discount, cash and bank amounts. Click here to download all accounting excel templates for rs 199. Many companies will offer a discount to their debtors if they pay quickly.
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