Singh Arjun

Is cash book both a journal and ledger?


1 Answer

  1. Yes, the cash book is both a journal and a ledger. 

    To make the concept simpler, I would like to familiarize you with the meaning of journals and ledgers, which shall help in determining the reasons for a cashbook to be both a journal as well as a ledger.


    A journal is a descriptive financial record of a business that is used for future reconciling as well as a transfer to other books of accounts such as the ledger. It is a book of original entry.

    Cashbook is considered to be a journal because all the cash/bank receipts and payments are recorded in this book in a descriptive form similar to journal posting.


    In simple words, a ledger refers to recording individual accounts in a summarized form that are posted from a journal. It is a book of principal entry.

    A cashbook is considered to be a ledger because all the cash transactions that are made during a particular financial period are recorded in this book in a chronological order. When a cashbook is prepared there is no need for a cash a/c as the book serves the same purpose and therefore can be used as a substitute.

    Format of a Cashbook


    Date Particulars V.No. L.F. Cash Date Particulars V.No. L.F. Cash
      To Capital a/c         By Advertisement a/c      
      To Sales a/c         By Purchases a/c      
      To Mr. C’s a/c         By Stationery a/c      
      To Bank a/c         By Office expenses a/c      
                By Rent a/c      
                By Salary a/c      
                By balance c/d      

    Note: As we can see the format and posting of a cashbook are similar to that of journal and ledger accounts.

    Hope this helps.

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