Lets talk some more on the movement of money in the cash book?

Dr – Receipts

Cr – Payments

When money is received the bank balance increases and when money is paid out, the bank balance reduces. J

Simple hey!!!

Lets see how you get on with this simple scenario:

·        Where there is an opening debit bank balance of £12,030 and the totals recorded in the cash book for the year ended 30 April 20X5 were:

Receipts	£106,950
Payments	£121,490

Assuming there were no year-end adjustments, what will be the opening balance in the cash book as at 1 May 20X5?

 £­­­­­­­­­­­­­­­­­­­­­_________
debit / credit

I’m sure you would have got this correct and known that it will be……..

£2,510 credit since the cash book balance does not have money left in it, so it will have a credit balance.