4. How can we record a bank overdraft in an analysed cash book? If the opening bank balance in the analysed cash book is an overdraft, then it is entered in the Bank column on the credit side of the cash book. This is money owed to the bank, so it is a liability.
Example 8: Recording a bank overdraft 1/1/20– Cash on hand is €500 and cash at bank is €850 (Cr) overdraft.
Dr side (money received) Analysed Cash Book A/c Date Details F Cash Bank 1/1/20– Balance b/d
€ € € € 500
Cr side (money paid out)
Date Details F Cash Bank €
1/1/20– Balance b/d
€ € € 850
LO 1.12 1.13
Pair work
Aaron has a good job and earns €4,000 per month. He is renting an apartment and repaying a loan on a new car he bought last year. However, he is struggling with his finances and usually has nothing left by the end of the month because he spends so much. 1. Identify the possible benefits to Aaron of keeping an analysed cash book.
2. Recommend five expenditure columns that Aaron could have in his analysed cash book.
5. How can we present personal financial information graphically?
Sometimes, figures represented as graphs can reveal trends that may not be so obvious when just looking at figures in accounts such as cash books. We can use graphs to present our household budgets and analysed cash books. Charts such as these can be produced using computer spreadsheets.
