What is credit balance in cash book?
A credit balance in cash book is a overdraft as per pass book. The bank maintains the customer account which is further printed in the passbook. The passbook is made from the view point of the bank hence customer depositing money is a liability to the bank and is credited.
Why cant cash book have a credit balance?
Answer: Explanation: it is because cash is an asset for the business and bringing down credit balance ( by balance c/d) would suggest that cash has a credit balance which is against the rules .
When cash book shows credit balance it is called?
A credit balance in cash book is a overdraft as per pass book.
Why cash book shows debit balance?
Cash column of cash book will always show debit balance because cash payment can never exceed the cash in hand.
Which account never have a credit balance?
Accounts Receivable is always have a normal debit balance because this is part of Assets and all asset accounts has a final debit balance. While Accounts Payable should have a credit balance because it is part of the Liabilities account and all liabilities account has normal credit balance.
Why does cash account never shows a credit balance answer in one sentence?
Answer: Total of the debit side of the Cash Book or Cash A/c always exceeds its credit side because payments of a business cannot exceed the receipts amount. … When payments are exactly equal to the receipts of the business, it will show zero balance, but it can never show the credit balance.
Can a cash book have zero balance?
Cash column of cash book can never have balance.