"I think something's missing in my life... Like... 2-3 million dollars"           "Great things never came from comfort zones"           "Good, better, best. Never let it rest. Till your good is better and your better is best"           "Investment is an asset or item that is purchased with the hope that it will generate income or appreciate in the future"           "You cannot save time for future use, but you can invest it for the future you"           "Wealthy people invest first and spend what’s left and broke people spend first and invest what’s left"           "The secret to getting ahead is getting started.................Start using your Savings to Earn Money"           "The best gift, and investment, you can give your child is your time"           "Investing in your child’s education is never a wasted effort"           "Do something today that your future self will thank you for"

Difference-between-Receipt-n-Payment-Account-and-Income-n-Expenditure-Account

 

Difference between Receipt n Payment Account and Income n Expenditure Account

290 views
2
 

S. No.

Particulars

1.

Cash and Non cash transaction

Only cash transactions are recorded here.

It is not confined to, cash transactions only, i.e. non-cash transactions are also included in it.

2.

Shows an items

Receipts are shown on the debit side and payments on the credit side.

All revenue incomes appear on the credit side and expenditure on the debit side.

3.

Capital and revenue items

It includes both capital and revenue receipts & payment

 It includes only income and expenditure of revenue nature

4.

Balance sheet

It includes both capital and revenue items, so it need not necessarily be accompanied by a Balance Sheet.

It includes only revenue items, so it must be accompanied by a balance sheet, the balance sheet contains the remaining balances.

5.

Type of Account

It is a Real Account

It is a Nominal Account

6.

Transfer of Closing Balance

Its balance is carried over to Receipts & Payments Account of the next year.

Its balance is transferred to Capital Fund.

7.

Opening Balance

This account shows opening balance except in the first year.

It has no opening balance.

8.

Transactions

Transactions relating to past, present and futures are recorded.

Transactions relating to current year only are recorded.

9.

Adjustment

Adjustments are not considered, because it is prepared on cash basis of accounting.

Adjustments are considered necessary because it is prepared on accrual basis of accounting.

10.

Use of Double Entry System

The double entry bookkeeping system is not followed while its preparation.

Double entry bookkeeping system is followed strictly while its preparation.

11.

Compulsory

Its preparation is not compulsory.

It is compulsory. It must be prepared in order to ascertain the true result of a concern.

12.

Closing Balance

Closing balance of this account represents the closing cash in hand and at bank or overdraft at bank.

Closing balance of this account indicates either excess of income over expenditure or excess of expenditure over income.

 



Comments


Leave a Reply

Name *
Comments *
   

© 2019 - Understand Your Income