state the essential features of receips and payment
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(i) It is a 'real account'. While making posting in the account rule of debit and credit regarding real accounts are used.
(ii) Whenever amount is received, cash account is debited. This is why, all cash receipts are recorded at the debit region.
(iii) Cash account is credited for all payments, so all cash payments are shown at the payment side.
(iv) Receipts and payments account is closed as showing the closing cash balance of the year, which is shown as the first item at the debit side.
(v) Receipts and payments account is closed as showing the final balance of the period which is available as the last item at the credit region.
(vi) Receipts and payments account records all cash receipts, whether it is capital receipt or revenue receipt. Amount received from subscription and also amount received from sale of building are shown at the receipt side. No distinction is made between capital receipts and revenue receipts.
(vii) All cash expenditure whether capital or revenue is shown at the payment side. Both cash payment for salaries and furniture are shown in this account. This account does not differentiate between capital and revenue expenditure.
(viii) All cash receipts, whether belonging to the current year or previous year or next year are recorded as receipts.
(ix) All cash payments whether concerning current year or previous year or next year is recorded at the payment side.
(x)This account does not show net income or net loss.
(xi) No adjustments are made in it.
(xii) We cannot prepare Balance sheet on the basis of this account.
(ii) Whenever amount is received, cash account is debited. This is why, all cash receipts are recorded at the debit region.
(iii) Cash account is credited for all payments, so all cash payments are shown at the payment side.
(iv) Receipts and payments account is closed as showing the closing cash balance of the year, which is shown as the first item at the debit side.
(v) Receipts and payments account is closed as showing the final balance of the period which is available as the last item at the credit region.
(vi) Receipts and payments account records all cash receipts, whether it is capital receipt or revenue receipt. Amount received from subscription and also amount received from sale of building are shown at the receipt side. No distinction is made between capital receipts and revenue receipts.
(vii) All cash expenditure whether capital or revenue is shown at the payment side. Both cash payment for salaries and furniture are shown in this account. This account does not differentiate between capital and revenue expenditure.
(viii) All cash receipts, whether belonging to the current year or previous year or next year are recorded as receipts.
(ix) All cash payments whether concerning current year or previous year or next year is recorded at the payment side.
(x)This account does not show net income or net loss.
(xi) No adjustments are made in it.
(xii) We cannot prepare Balance sheet on the basis of this account.
moona70:
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