Bothe receipts and payments account and cash book are prepared on the cash basis of accounting. Both records cash and bank transactions.
Despite few similarity they both have few differences.
In this lecture we would discuss few basic difference between receipts and payments account and cash book
Distinction between Receipts and Payments account and Cash Book
|Basis||Receipts and Payments||Cash Book|
|1. Basis||It is prepared from cash book in summarised from||It is prepared on the basis of each cash receipt and cash payment transaction.|
|2. Sides||It has receipts and payments side. the left one is receipts and the right one is payment.||It has debit and credit sides|
|3. Period||It is prepared at the end of accounting as a summarised form of the cash book.||It is prepared on daily basis.|
|4. Ledger Folio Column||It has no Ledger Folio columns||It has ledger Folio columns.|
|5. Part of Double Entry System||It is not part of a double-entry system. It is merely a summary of cash book||It is prepared following double entry system of accounting.|
|6. Institutions||It is prepared by Not for profit organization (NPO)||It is prepared by all organizations whether profit or non profit.|