Receipts & Payments Account (Cambridge (CIE) IGCSE Accounting)

Revision Note

Donna Simpson

Written by: Donna Simpson

Reviewed by: Dan Finlay

Receipts & Payments Account

What is a receipts and payments account?

  • A receipts and payments account is a simple cash book 

    • They are prepared each year by clubs and societies

  • Clubs and societies use the account to record receipts and payments

    • Amounts are not separated into cash or bank transactions

    • They are summarised as money in and money out

What is the layout of a receipts and payments account?

  • A receipts and payments account is prepared in a similar way to a cash book

    • Amounts received are debited

    • Amounts paid are credited

  • Receipts might include:

    • Subscriptions from members

    • Sales revenue from trading activities of the club

      • Such as selling refreshments

  • Payments might include:

    • Expenses for utilities

    • Purchase of inventory for the trading activities

Layout of a receipts and payments account
Layout of a receipts and payments account

Worked Example

The Old Mill Golfing club offers lessons to amateur golfers and it also provides a place for experienced golfers to play regularly. It also has a shop where golfing equipment can be bought. 

The club had $4 120 in the bank on 1 June 2023.  The club provided the following list of receipts and payments for the year ended 31 May 2024.

$

Subscriptions received

66 400

Revenue for shop sales

8 350

Purchases of golfing equipment for resale

4 980

Wages

44 700

General expenses

5 100

Purchase of golf carts for the club

14 400

Income from the rental of golf carts

5 200

Prepare the receipts and payments account for The Old Mill Golfing club for the year ended 31 May 2024. Balance the account and bring down the balance at 1 June 2024.

Answer

The bank balance on 1 June 2023 is the opening balance and goes on the debit side.

Label each item as:

  • A debit if the club received money

  • A credit if the club paid money

$

Subscriptions received

66 400

Debit

Revenue for shop sales

8 350

Debit

Purchases of golfing equipment for resale

4 980

Credit

Wages

44 700

Credit

General expenses

5 100

Credit

Purchase of golf carts for the club

14 400

Credit

Income from the rental of golf carts

5 200

Debit

Enter the entries into the receipts and payments account. And then balance the account and bring down the balance.

The Old Mill Golfing Club

Receipts and Payments Account for year ended 31 May 2024

Date

Details

$

Date

Details

$

2023

June 1

 

Balance b/d 

 

4 120

2024

May 31

 

Shop purchases

 

4 980

2024

May 31

 

Subscriptions 

 

66 400

May 31

Wages

44 700

May 31

Shop sales

8 350

May 31

General expenses

5 100

May 31

Rental income

5 200

May 31

Golf carts purchase

14 400

              

May 31 

Balance c/d

14 890

84 070

84 070

2024

June 1

 

Balance b/d

 

14 890

Last updated:

You've read 0 of your 5 free revision notes this week

Sign up now. It’s free!

Join the 100,000+ Students that ❤️ Save My Exams

the (exam) results speak for themselves:

Did this page help you?

Donna Simpson

Author: Donna Simpson

Expertise: Accounting Content Creator

Donna is a classroom practitioner with over 25 years experience in teaching accounting and business studies at GCSE A-Levels and undergraduate levels, both in the UK and abroad. She currently works for a Multi-Academy Trust (MAT) as a teacher, instructional coach and mentor to other teachers. Donna is also an AQA A Level Accounting examiner as well as the content creator of resources used by all accounting teachers across the Trust. She enjoys designing and creating resources that provides students with deeper understanding of the subject content. Donna has a Bachelor of Science Degree in Business Administration with major in Accounting and Finance (BSc Hons) and ACCA certified to Level 2.

Dan Finlay

Author: Dan Finlay

Expertise: Maths Lead

Dan graduated from the University of Oxford with a First class degree in mathematics. As well as teaching maths for over 8 years, Dan has marked a range of exams for Edexcel, tutored students and taught A Level Accounting. Dan has a keen interest in statistics and probability and their real-life applications.