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. All cash receipts are recorded
on the Receipts side (i.e. Debit side) and all cash payments are
recorded on the Payments side (i.e. Credit side) of Receipts and
Payments Account. 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 not only records the cash and bank transactions relating
to the current accounting period, but also the cash and bank receipts
(or payments) received during the current accounting period that may
be related to the previous or next accounting period.
This account only
helps us to ascertain the closing balance of the cash and bank and
helps in assessing the cash position of an NPO.
Receipts and Payments Account is a summary of the Cash Book. All cash receipts are recorded on the Receipts side (i.e. Debit side) and all cash payments are recorded on the Payments side (i.e. Credit side) of Receipts and Payments Account. 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 not only records the cash and bank transactions relating to the current accounting period, but also the cash and bank receipts (or payments) received during the current accounting period that may be related to the previous or next accounting period.
This account only helps us to ascertain the closing balance of the cash and bank and helps in assessing the cash position of an NPO.
