From the following information prepare Double Column Cash Book. 2018 May 1 Opening Balance : Cash Rs.8,75,000 Bank (Cr.) Rs. 25,250 2 Machinery purchased Rs.1,15,000 3 Water bill paid Rs. 9,000 4 Salary paid by cheque Rs. 23,500 6 Sold goods for cash Rs. 90,000 (GST @12%) 7 Purchased from Manohar for cash Rs. 18,000 (GST @12%) 9 Cash deposited in to bank Rs. 3,2,000 10 Purchased from Nandan Rs. 48,000 12 Cheque issued to Nandan Rs. 48,000 13 Sold to Nayan Rs. 23,200 17 Sold to Shalini Rs. 60,000 19 Cash received from Shalini Rs. 35,000 22 Cheque received from Shalini Rs. 15,000 23 Shalini directly deposited in bank Rs. 10,000 25 Shalini’s cheque paid in to bank for collection 26 Goods withdrawn for personal use Rs. 43,000 28 Cash taken from bank Rs. 23,000 29 Cash taken from bank for personal use Rs. 12,000 30 Cash taken for personal use Rs. 9,500 31 Shalini’s cheque returned dishonoured
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
From the following information prepare Double Column
2018
May 1 Opening Balance : Cash Rs.8,75,000
Bank (Cr.) Rs. 25,250
2 Machinery purchased Rs.1,15,000
3 Water bill paid Rs. 9,000
4 Salary paid by cheque Rs. 23,500
6 Sold goods for cash Rs. 90,000 (GST @12%)
7 Purchased from Manohar for cash Rs. 18,000 (GST @12%)
9 Cash deposited in to bank Rs. 3,2,000
10 Purchased from Nandan Rs. 48,000
12 Cheque issued to Nandan Rs. 48,000
13 Sold to Nayan Rs. 23,200
17 Sold to Shalini Rs. 60,000
19 Cash received from Shalini Rs. 35,000
22 Cheque received from Shalini Rs. 15,000
23 Shalini directly deposited in bank Rs. 10,000
25 Shalini’s cheque paid in to bank for collection
26 Goods withdrawn for personal use Rs. 43,000
28 Cash taken from bank Rs. 23,000
29 Cash taken from bank for personal use Rs. 12,000
30 Cash taken for personal use Rs. 9,500
31 Shalini’s cheque returned dishonoured
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