What Are Cash Sales - Definition And Meaning With Example

Cash Sales means that goods sold for cash or services rendered to customers on Cash Basis i.e., as soon the services are received by the customer, he makes Cash Payment. Cash Sales is a source of Direct Revenue for the business as it helps the business in smooth running of business’ operations.

Cash Sales Journal Entry

Example: Mr. A, as a retailer, sold 5 tables to Mr. B, a customer for Cash Rs. 10000. This is Cash Sales Transaction and it is recorded in Cash Book as shown below:

                                                              Cash a/c   10000

                                                                           Sales a/c   10000

(5 Tables Sold For Cash)

Cash Sales is recorded in Income Statement / Profit And Loss Account at the end of accounting period. It is credited when it is received by the company and it is debited when it closed at the end of Accounting Cycle.