State the meaning of Receipt and Payment Account.
State the meaning of Receipt and Payment Account.
Receipts and Payments Account is a summary of the Cash Book Receipts and payment account helps in ascertaining the closing balanced the cash and bank and helps in assessing the cash position of a Not-for-Profit Organisation. Actually it gives us a summarised picture of various receipts and payments, irrespective of whether hpe they are to the current period, previous period or succeeding period or whether capital or revenue nature.
It is prepared on the basis of cash and bank transactions recorded in the Cash Book. It begins with the opening balance of cash and bank and ends with the closing balances of cash and bank (balancing figure) at the end of the accounting period. It records all cash and bank transactions both of capital and revenue nature.
It may be noted that this account does not show any non-cash item like depreciation. In the debit side i.e., Receipts side all the cash receipts are recorded on the other hand in the credit side of i.e., Payment side all the cash payment are recorded. The Proforma of Receipts and Payment account is as follows.
*Either of the two will appear.
Receipts and Payments Account is a summary of the Cash Book Receipts and payment account helps in ascertaining the closing balanced the cash and bank and helps in assessing the cash position of a Not-for-Profit Organisation. Actually it gives us a summarised picture of various receipts and payments, irrespective of whether hpe they are to the current period, previous period or succeeding period or whether capital or revenue nature.
It is prepared on the basis of cash and bank transactions recorded in the Cash Book. It begins with the opening balance of cash and bank and ends with the closing balances of cash and bank (balancing figure) at the end of the accounting period. It records all cash and bank transactions both of capital and revenue nature.
It may be noted that this account does not show any non-cash item like depreciation. In the debit side i.e., Receipts side all the cash receipts are recorded on the other hand in the credit side of i.e., Payment side all the cash payment are recorded. The Proforma of Receipts and Payment account is as follows.
*Either of the two will appear.
