Question

Which account is a summary of cash book?
a: Income and expenditure account
b: Receipts and payments account
c: Balance sheet​

Answer 1

Answer:

Receipt and Payment Account

Explanation:

A receipt and payment account is a summarized cash book for a given period”.”This is a summary of the cash transactions as in the cash book”.

Answer 2

Answer:

Account

Receipt and payment account cannot disclose the true result of a non-profit organization. We prepare this account on the basis of the information available from the cash book.

Characteristics of Receipt and Payment Account

Following are the characteristics of receipt and payment account:

It is a summary of the cash book.

We record all the cash receipts during the whole year on its debit side. Whereas, we write all the cash payments for the whole year on its credit side.

We include both receipts and payments in cash whether they are of capital and revenue nature.

We record only cash transactions in receipt and payment account.

It generally shows a debit balance. In the case of overdraft balance, its net balance may be credit.

Its closing balance shows closing cash in hand and closing cash at the bank.

Non-cash items such as depreciation, outstanding expenses, accrued incomes are also shown in this account.