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(8) THE CASH BOOK AND THE PETTY CASH BOOK

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  Cash book  This is the prime entry book in which the receipts and payments of cash (currency) are recorded. A business has various sources of cash receipts as well as different ways of payments.  Examples for sources of cash receipts of a business  The owner's capital  Cash sales  Cash received from debtors  Borrowing money  Cash receipts for rent income, investment income and income on commissions  Examples for payments a business makes  Purchase of goods for cash  Repayment of loans  Cash payment to creditors  Payments made for expenses such as salaries for employees, electricity, etc.  Payments made for purchasing fixed assets such as furniture, equipment, etc.  Withdrawal of cash by the owner for personal use (drawings)  The receipts and payments of cash by the business are recorded in the cash book using receipts and payment vouchers respectively as source documents.  Receipts  When a busi...
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(1) BACKGROUND OF BUSINESS

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Basic Concepts about Businesses When the social existence of a human develops, individual needs also widened gradually. When the needs and wants were diversified, it was difficult to produce all their needs and wants by themselves. As a remedy to this problem, people started to produce a large quantity of goods that they could produce the best, with the skills and resources they had. Therefore, an excess of goods was created. Then people exchanged their excess goods with others to obtain other goods they wanted. This system of exchanging goods was known as the 'Barter System'.  Even today, no one produces all what he or she wants. The farmer produces rice; the carpenter makes furniture; the teacher teaches. This individual is either a producer or a consumer in different instances. Such producers and consumers fulfill their needs and wants through businesses. Therefore, businesses are given immense importance in the modern society.  Business Concept  Man needs goods and se...
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 Pyramid Carefully observe the solid objects in the above figure. Note that their faces are polygons. Of these faces, the horizontal face at the bottom is called the base. All the faces, except the base are of triangular shape. The common point of these triangular faces is called the "apex". A solid object with these properties is called a "pyramid". Note that the bases of the Pyramids shown above are respectively, the shape of a quadrilateral, a pentagon and a hexagon. Right pyramid with a square base The base of the pyramid in the figure is a square. All the remaining faces are triangular in shape. If the line segment connecting the apex and the midpoint of the square base (that is the intersection point of the two diagonals) is perpendicular to the base, then such a pyramid is called a "square based right pyramid". The length of the line segment connecting the apex and the midpoint of the base is called the perpendicular height (or simply ...
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