Introduction to Financial and Management Accounting

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  1. Cash Book
    A cash book is a written record of the amounts of money that a business receives or pays out.  The cash book is divided into two sides-receipts(debit) side and payments(credit) side.
  2. Three column bash book
    A three column cash book has three columns to split the money received between cash, bank and discounts.  It will usually also have a column for the date and another for the details of the entry, on each face of the page.
  3. Analyzed column cash book
    This is a cash book where in addition to the columns showing whether it was cash or a bank transaction, it shows that the amount was for - so sales receipt, purchases payment, expenses, sales tax etc.
  4. Close off (balance off) the account
    This means that the debit and credit sales of the account are totaled and the difference between the two is calculated.  The difference is the amount that is required to make the accounts balance.
  5. Balance carried down (Balance c/d)
    The difference between the debit and credit side of the account is calculated.  This is the balance that is carried down to the next time period.
  6. Balance brought down (balance b/d)
    This is the balance carried down from the previous period.
  7. Contra entry
    This is an equal and opposite entry.  We will learn when these happen in future studies.
  8. Overdrawn
    This is when the bank has paid out more money than we had in our account.  An overdraft is a short term loan from the bank.
  9. Debit
    This is an active verb and a noun.  We debit an account in certain situations.  For example, in a cash book we write a cash receipt in as a debit.
  10. Balance
    The difference between the incoming cash and outgoing cash.
  11. Balancing the cash book
    It allows us to know how much money the business has at the end of the day.
  12. Paying-in book
    We can bank cash and checks using a paying-in book that the bank gives us when we set up an account.
  13. Opening Balances
    The opening balance on an account or statement is the amount in the account on the day the account or statement is started.
  14. Closing balances
    The closing balance on an account is the amount in the account at the close of the time period-often a month.
  15. Unpresented checks
    A check which has not been paid into the bank
  16. Outstanding Lodgements
    An amount that in the cash book has been listed as a receipt,but it has not yet been recorded in the bank account.  It will form part of the reconciling items in a bank reconciliation.
Card Set:
Introduction to Financial and Management Accounting
2015-08-07 16:02:56

Cash Book
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