A cash book is a financial journal that records all cash receipts and disbursements of a business.What is the primary purpose of maintaining a cash book?The primary purpose is to track cash flow and maintain an accurate record of cash transactions.Differentiate between a single-column cash book and a double-column cash book.A single-column cash book has one column for recording all cash transactions, while a double-column cash book has separate columns for cash and bank transactions.What are the typical columns found in a double-column cash book?The typical columns are cash, bank, discount received, and discount allowed.Explain the significance of the cash column in a cash book.The cash column records all cash receipts and payments, providing a summary of cash transactions.What does the bank column represent in a cash book?The bank column records all transactions related to bank accounts, including deposits and withdrawals.How do you record cash transactions in a single-column cash book?Cash receipts are recorded on the debit side, and cash payments are recorded on the credit side.Describe the process of recording cash transactions in a double-column cash book.Cash transactions are recorded in the cash column, while bank transactions are recorded in the bank column.What is the purpose of posting entries from a cash book to the general ledger?Posting entries to the general ledger ensures that all transactions are accurately reflected in the company's financial records.How do you reconcile a cash book with a bank statement?Reconciliation involves comparing the entries in the cash book with those on the bank statement and adjusting for any discrepancies.What are the consequences of errors in a cash book?Errors can lead to inaccuracies in financial reporting, mismanagement of funds, and difficulties in decision-making.Explain the difference between an overdraft and a cash balance in a cash book.An overdraft occurs when the bank balance is negative, indicating that the business has borrowed more than it has in its account. The cash balance represents the actual cash on hand.Why is it important to maintain accuracy and timeliness in updating cash books?Accurate and timely updating ensures that financial information is reliable for decision-making and financial reporting purposes.