Given: I. It records subscription in arrears II. Payments of liabilities is effected III. The...

JAMB 2023

Given:

I. It records subscription in arrears
II. Payments of liabilities is effected
III. The account does not show if cash payment is revenue or capital expenditure
IV. It performs the same function as cash book

The features of receipts and payment account includes:

A. III and IV
B. I, II and IV
C. II, III and IV
D. I, II and III

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Correct Answer: Option C

Explanation

The features are:
- include capital and revenue items
- accruals and prepayments are not included
- it is a real account
- only actual receipts and payments are recorded
- balance represent cash in hand

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