Page 75 - VIRANSH COACHING CLASSES

2.2.1 Meaning of Receipts and Payments Account :
The day to day transactions of a ‘Not For Profit’ concern are recorded in a cash book and then
they are posted to Ledger Accounts. At the end of financial Period the cash book and ledger accounts
are balanced and from these balances, Receipts and Payments Account is prepared.
The Receipts and Payments Account is a Real Account. Credit transactions are not recorded in
Receipts and Payments Account. Receipts and Payments Account is a summary of cash and bank
transactions for a particular Period. All receipts are shown to the debit side and all Payments to the
credit side.
This Accounts starts with opening Cash and Bank Balance (Different Banks) and closes with
Cash and Bank Balance at the end of the year.
Receipts : All receipts during a particular Period are debited to Receipts And Payments
Account irrespective of the year for which they are received and irrespective of their nature Revenue
or capital. Such receipts may be related to previous year or current year or next year. All receipts are
debited to this account. (Revenue capital)
Payments : All Payments made during a particular period are credited to Receipts and Payments
Account irrespective of the period to which it related and irrespective of their nature Revenue or
Capital. Such Payments may be related to previous year a current year or next year similarly such
Payments may be Revenue or Capital expenditure. All are credited to this account.
Receipts and Payments Account
st
for the year ended 31 March 20......
Dr. Cr.
Receipts Amount Payments Amount
` `

To All Receipts ............ By All Payments ............
(Revenue or Capital) (Revenue or Capital)
Previous year - ............ Previous year - ............
Current year - ............ Current year - ............
Next year - ............ Next year - ............

2.2.2 Features of Receipts and Payments Account :
1. Receipts and Payments Account is a Real Account
2. Receipts and Payments Account is similar to cash book (summary of cash & Bank
transactions)
3. It includes all types of Receipts and Payments (Revenue or Capital)
4. It records all receipts and payments made during a particular period i.e. Current year.
(previous, current or next year)
5. Income Receivable and amounts Payable are not recorded in this account.
6. This account is a base to prepare Final Accounts of ‘Not for Profit’ concerns
7. This account shows opening and closing balances of cash and Bank (or Bank overdraft).
2.2.3 Types of Receipts :
i) Capital Receipts ii) Revenue Receipts
ii) Capital Receipts :- All such receipts are non - recurring in nature and not forming a
part of regular flow of income of a concern are known as capital Receipts e.g Spectific
Donations for Building, Sports Tournaments, Library, life membership fees, sales proceeds

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