Question

Steps in sequence in the preparation of Receipt and Payment Account will be:
1. Find out the difference between the total of debit side and the total of credit side
2. Show the total amounts of all receipts on debit side
3. Take the opening balance of cash in hand and bank and enter on the debit side
4. Show the total amounts of all payments on credit side
Choose the correct answer from the options given below:

• A. (A), (B), (C), (D)
• B. (A), (C), (B), (D)
• C. (B), (A), (D), (C)
• D. (C), (B), (D), (A)

Answer 1

The Correct Option is D

\(\textbf{Step 1:}\) Initiate the Receipt and Payment Account with the initial cash and bank balances. This constitutes the account's starting point and is recorded on the debit side.
\(\textbf{Step 2:}\) Subsequently, document all incoming cash within the accounting period on the debit side.
\(\textbf{Step 3:}\) Following this, itemize all outgoing cash payments made during the period on the credit side.
\(\textbf{Step 4:}\) Conclusively, determine the variance between the sum of the debit and credit entries to ascertain the final balance.

Therefore, the correct order is: (C), (B), (D), (A).