How to Set Up a Cash Receipt Journal
A cash receipt journal is a bookkeeping tool used to record all the cash a business receives. This bookkeeping method does not record business expenses or payments made on the business's behalf. According to the Bean Counter website, you should record the cash your business receives from the sale of your products or services, fees, money collected for client accounts and any other source of cash. A cash receipt journal can help you manage your company's cash flow and keep track of your sales and accounts receivable, as well as provide a supporting document for your tax returns.
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Instructions
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Label your cash receipt journal. Labeling the journal clearly will help prevent you from recording inappropriate, non-cash related business transactions by mistake. In addition to indicating that your journal is for cash receipts, add the name of the business to the front of the journal if you have more than one business. For example, adding the business's name may be helpful for a person who owns and operates more than one online store.
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Label the top horizontal rows of the ledger to make column headings. Bean Counter suggests using the following column headings: Entry Number, Date, Source of Cash Received, Posting Reference 1, Accounts Receivable Number, Sales Account Number, Other Account Number, Description of Payment, Amount Received, Posting Reference 2 and Cash Account Number.
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Label the entry numbers in a consecutive, ascending order. At the beginning of each month, you can restart with the number 1 or use the number the follows the last entry number you recorded the previous month.
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Enter the date of the transaction in the "Date" column.
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Indicate where you obtained the funds you are recording in the "Source of Cash Received" column. The source can be from the sale of an item or service, a deposit slip, a bank loan or a customer payment.
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Make a check mark in the appropriate box in the "Posting Reference 1" column to remind yourself that that you need to record the same transaction in a subsidiary ledger.
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Write the corresponding account number in the "Accounts Receivable Number," "Sales Account Number" or "Other Account Number" column.
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Include a brief description of your cash source in the "Description" column. In this section, you can include a customer's name, the name of the item sold, the name of the bank that provided you with a loan or a service package a client purchased.
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Check the box in the "Posting Reference 2" column, if appropriate, after updating the subsidiary ledger.
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Tips & Warnings
You can create a separate cash receipt journal page for each accounts receivable, sales and miscellaneous account you have in your business.
References
Resources
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