Cash and cash equivalents

Cash and cash equivalents, numbered 1260, is the group that totals the money the business can spend at once: the Cash ledger for notes in the drawer and the Bank Accounts sub-group for every bank ledger and Bank Suspense. Its total is the closing figure the Cash Flow Statement arrives at and the first number a lender or the owner checks. In the demo books it stands at Rs 25,68,160 after Jivan Dahal's payment. Payment Entries always name a specific child, Cash or a bank ledger, so the group itself never takes a posting. A credit balance anywhere beneath it means an overdraft, which should be a liability, or a receipt posted the wrong way round.

Cash and cash equivalents = Cash + Sum of Bank Accounts (incl. Bank Suspense) = Closing cash on the Cash Flow Statement.

1. 01Go to Accounts Setup > Chart of Accounts and expand Assets > Current Assets > Cash and cash equivalents.
2. 02Read the children: Cash and the Bank Accounts group with its bank ledgers.
3. 03Open Financial Reports > Balance Sheet; the group shows Rs 25,68,160 in the demo.
4. 04Open Financial Reports > Cash Flow; its closing cash equals this group.
5. 05On a Payment Entry, pick Cash or a bank ledger as the account paid from or to, never the group.

Do not post here. Payment Entries use Cash or a specific bank account under Bank Accounts.

Yatra For Fun shows Cash and cash equivalents of Rs 25,68,160 after Jivan Dahal's payment.