Thursday, 15 September 2016

DO YOU UNDERSTAND THE MOVEMENT OF MONEY IN THE CASH BOOK ?

Lets see how you get on with this simple scenario:

·  Where there is an opening debit bank balance of £2,290 and the totals recorded in the cash book for the year ended 30 June 20X1 were:

Receipts
£259,298
Payments
£262,698

Assuming there were no year-end adjustments, what will be the opening balance in the cash book as at 1 July 20X1? £­­­­­­­­­­­­­­­­­­­­­_________ debit / credit

I’m sure you would have got this correct and known that it will be

£1,110 credit since the cash book balance will now be overdrawn, so it will have a credit balance.

Yours Sincerely,
The Friendly Team

The Training Place of Excellence Limited

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