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What are four objective of preparing receipt and payment account , plzzzzz help?
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What are four objective of preparing receipt and payment account , plz...
Objectives of Preparing Receipt and Payment Account:
1. To Summarize Cash Transactions:
The primary objective of preparing a Receipt and Payment account is to summarize all the cash transactions of an organization for a particular period. It records all the cash receipts and payments, which helps to analyze the cash flow of the organization.
2. To Monitor Cash Management:
The Receipt and Payment account provides a clear picture of the cash position of an organization. It helps the management to monitor and control the cash management of the organization effectively. It helps to identify the sources of cash inflow and outflow and also the nature of expenditure.
3. To Prepare Cash Budget:
Preparing a Receipt and Payment account helps to prepare a cash budget for the upcoming period. By analyzing the cash inflows and outflows, the management can estimate the cash position for the future and prepare a budget accordingly.
4. To Facilitate Decision-making:
The Receipt and Payment account provides a comprehensive report of all the cash transactions of an organization. It helps the management to make informed decisions regarding cash management, budgeting, and investment. It also helps to identify the areas where the organization needs to improve its cash management.
Conclusion:
In conclusion, preparing a Receipt and Payment account is essential for any organization to monitor and control its cash management effectively. It helps to summarize cash transactions, monitor cash management, prepare cash budgets, and facilitate decision-making. By analyzing the cash inflows and outflows, the management can identify the areas where the organization needs to improve its cash management and take appropriate action.
1. To Summarize Cash Transactions:
The primary objective of preparing a Receipt and Payment account is to summarize all the cash transactions of an organization for a particular period. It records all the cash receipts and payments, which helps to analyze the cash flow of the organization.
2. To Monitor Cash Management:
The Receipt and Payment account provides a clear picture of the cash position of an organization. It helps the management to monitor and control the cash management of the organization effectively. It helps to identify the sources of cash inflow and outflow and also the nature of expenditure.
3. To Prepare Cash Budget:
Preparing a Receipt and Payment account helps to prepare a cash budget for the upcoming period. By analyzing the cash inflows and outflows, the management can estimate the cash position for the future and prepare a budget accordingly.
4. To Facilitate Decision-making:
The Receipt and Payment account provides a comprehensive report of all the cash transactions of an organization. It helps the management to make informed decisions regarding cash management, budgeting, and investment. It also helps to identify the areas where the organization needs to improve its cash management.
Conclusion:
In conclusion, preparing a Receipt and Payment account is essential for any organization to monitor and control its cash management effectively. It helps to summarize cash transactions, monitor cash management, prepare cash budgets, and facilitate decision-making. By analyzing the cash inflows and outflows, the management can identify the areas where the organization needs to improve its cash management and take appropriate action.
Community Answer
What are four objective of preparing receipt and payment account , plz...
Total receipts and total payments under various heads are available at a glance.The amount of cash in hand at the year end can be ascertained.The correctness of cash book can be verified through it. The total of debit side of cash book will agree with the total of receipt side of this account. On the other hand, the total of credit side of cash book will agree with that of payment of this account.
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What are four objective of preparing receipt and payment account , plzzzzz help?
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What are four objective of preparing receipt and payment account , plzzzzz help? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about What are four objective of preparing receipt and payment account , plzzzzz help? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What are four objective of preparing receipt and payment account , plzzzzz help?.
What are four objective of preparing receipt and payment account , plzzzzz help? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about What are four objective of preparing receipt and payment account , plzzzzz help? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for What are four objective of preparing receipt and payment account , plzzzzz help?.
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