Get Your Teaching Invoice Template for NPOs Seamlessly Created

Teaching invoice template for NPOs

what is a receipts and payments account receipts and payments account is a summary cash book it's like a summary cash book the entire cash receipts for the year are summarized underneath strength hits how much is the total subscription income that has come in what is the total entrance fees that have come in what money has come in by selling of old newspapers etc similarly also if we have disposed of our assets any furniture old furniture was old library old library books were sold etc money that has come if cash has come irrespective of whether the cash received related to a previous period related to the current period or related to the next period similarly any payments that have been made whether the payment was on account of expense or so it is total for example every month we might have been some maintenance expenses the total of the maintenance expenses paid in cash for the year is recorded in the receipts and payments are payments made in order to buy an asset payments made for the running of the particular organization everyday expenses of the organization any cash inflow any cash outflow is recorded in the receipts and payments occur in a summary form in a summary form so that the format is something like this receipts and payments account and I repeat though we say it's an account it is actually just a summary cash book it is not that by preparing the receipts and payments account we are completing any double entry we are not what it begins with it it says to balance brought down and we say what is the cash balance what is the balance we in bank one banks to wherever the not-for-profit organization has his accounts so all these are the opening balances of cash short bank which tunnel then we see what are the heads on account of which money has come in maybe we had subscriptions maybe we had donations get set maybe we sold for nature maybe we sold investments whatever similarly on the other side we write what the payments were maybe we purchased we purchased furniture he purchased investments we paid wages whatever cash flows were there and the ultimately the closing balance will give us the balance of cash in hand the balance and bank one the violence that bank - assuming we had two bank accounts this is how our receipts and payments account is prepared since it is a summary cash book if you are asked what is the nature of the account it's not a personal account it basically denotes cash cash is a real account it is an asset a real account and therefore the receipts and payments account is in the nature of a real account receipts and payments account is in the nature of a real account it begins with the opening balance and ends with the closing balance but it is not a part of the double-entry system it is only a summary of all the cash transactions that have occurred cash flows whether they are revenue or capital that's why I said whether you sell furniture or you get subscription income any cash flow will find its place in a receipt payments cash flows whether related to the current year or another year if we receive the subscription income of last year in the current year if we receive subscription income in advance for the next five years everything whatever is received finds its place in the receipts and payments account we do not consider a Kohl's allowed standing nothing of the kind all we see is what is the actual cash coming what is the actual cash going out so whether it's current here or another obviously we cannot know profit or loss from here because we don't have profit or loss we cannot know surplus or deficits all we know all we can do is confirm that the closing balance of cash balance at the banks are correct by recording all the cash flows in flows as well as outflows so receipts and payments account is a summary cash book a summary cash book which records all cash inflows it records all cash outflows whether it relates to the current period or another period whether they are revenue or they are capital what is its nature its nature reserve real account and because it reflects cash flows and only actual cash flows without any distinction between capital and revenue without any distinction between last year current year or next year we cannot determine surplus or deficit let us look at the format of a receipts and payments account the name of the organization receipts and payments account for the year so throughout the year what were the cash flows and what has the cash outflows cash flows cash inflows and cash outflows as we discussed it begins with the opening balance to subscription maybe for the current year maybe for the next year what is the total amount to received on account of subscriptions what is the amount see from relations by selling off assets and then what are the payments we need payment on account of honoraria now what is an honorarium honorarium is like a payment for services which are being mended let us say we have a cashier in the club this cashier in the club is probably one of the members who spends some time in the club in order to ensure protect cash keep safe custody of cash and account for the cash so why he's rendering services he is a member he may be paid a small amount it is they do not really call it a salary but we call it an honorarium because it's more like a payment and may not match the salaries that are paid in the industry similarly any other payment may be for rent this is not an expense but this is a purchase of asset like investment any other asset purchase electricity whatever cash flows are there I recorded on the right side and the balance as a result we get the closing balance of cash so this is how the receipts and payments account is prepared this is the format of the receipts and payments are