CASH BOOK

Meaning of cash book:

A cash book is a book where all the cash transactions of a business are
recorded. In other words, it is a book in which all cash receipts and all
cash payments are recorded. Non-cash transactions do not find any place
in the cash book. Cash book is both a journal and a ledger.
Types/kinds of cash book:

Following are the various types of cash book:

1. Single/one column cash book

2. Double/two column cash book
3. Three/triple column cash book
4. Petty cash book

1. Single/one column cash book:

This is also known as a “Simple Cash Book”. This type of cash book has
only one amount column (either cash or bank) on each side of the cash
book.

This book records all cash receipts on the left hand side and all cash
payments on the right hand side. The format of this type of cash book is
as follows:
In the books of ______
Single Column Cash Book
Date Particulars L.F. Amount (₹) Date Particulars L. F. Amount (₹)

2. Double/two column cash book:

This type of cash book has two amount columns on each side of the
cash book. These two columns may be cash and discount columns or
bank and discount columns or cash and bank columns.

This book records all cash receipts on the left hand side and all cash
payments on the right hand side. The format of this type of cash book is
as follows:
 In the books of ______
Double Column Cash Book
Date Particulars L.F. Cash/Bank Discoun Date Particulars L. F. Cash/Bank Discount
(₹) t (₹) (₹)
(₹)

3. Triple/three column cash book:

This type of cash book has three amount columns on each side of the
cash book. These three columns are cash, bank and discount columns.

This book records all cash receipts on the left hand side and all cash
payments on the right hand side. The format of this type of cash book is
as follows:

In the books of ______

Triple Column Cash Book
Date Particulars L.F. Cash Bank Discoun Date Particular L. F. Cash Ban Discount
(₹) (₹) t s (₹) k (₹)
(₹) (₹)

4. Petty cash book:

It is a cash book which is maintained in large business concerns to

reduce the burden of 'Main Cash Book'. In this type of cash book,
numerous cash transactions involving petty or small amounts are
recorded such as carriage & cartage, printing & stationery, wages,
conveyance, refreshment, postage etc. For this purpose, a cashier is
appointed who is called the petty cashier.

Petty cash book is maintained under the imprest system. Under this
system, the chief cashier advances a fixed sum of money (called an
imprest or float) to the petty cashier at the beginning of a given period to
enable him to meet petty expenses for that period. The petty cashier
incurs the amount of petty expenses during the period out of this amount
money. At the end of the period, the petty cashier submits the
documents or vouchers of the petty expenses incurred to the chief
cashier. The chief cashier now verifies the documents or vouchers
submitted to him in detail and reimburses the total amount of expenses
to the petty cashier. Now the petty cashier will have the same amount of
imprest as before to meet the petty expenses in the next period.
The format of a petty cash book is as follows:
In the books of ______
Triple Column Cash Book
Amount Date Particulars V. Total Conveyance Printing & Carriage Refreshment Sundries
received No. Amount Stationery &
(₹) Cartage
(₹) (₹) (₹) (₹) (₹) (₹)

Advantages of cash book:

The following are the main advantages of maintaining a cash book:

 It prevents duplication of work in entering cash transaction in

journal and then posting the same into the ledger.
 Both cash and bank transactions are recorded in cash book.
 It is possible to find out daily cash and bank balances.
 It also serves the purpose of journal as well as ledger.
 Frauds involving cash are likely to be minimized and where
committed, are likely to be detected at an early stage.