what are the types (methods) of single entry system?

Let us see the 3 different types or methods of a single entry system. We will also look, what is this system and how it works as well.

What is Single Entry System?

Under the Single Entry System of bookkeeping, only one aspect of the transaction is recorded. Generally, each transaction has dual aspect such as the giving and receiving aspect. But, here, only one aspect either receiving or giving aspect is recorded in books of accounts.

This dual aspect concept such as the giving and receiving aspect is also termed as debit and credit. Under this system, only one aspect of the transactions is recorded. Here, this System is generally referred to as the accounting for incomplete records or incomplete system of recording.

For example, Cash paid to Supplier has two aspects. One aspect is Cash and another one is Supplier. But in this system, as explained earlier only one aspect is recorded. It means either Cash paid or Supplier name will be recorded in this system.

Very often, Sole trading concerns and small partnership businesses generally follow the Single Entry System of Bookkeeping. They maintain few records like Cashbook, Personal accounts like debtors or customers records and suppliers records. At the end of the year, these small business concerns want to know the financial performance and position. Here, generally, Accountants prepare income statement and statement of affairs to know the financial performance and financial standings.

Statement of Affairs is generally prepared to know the capital amount at the beginning and end of the year. Statement of Affairs is used to derive opening capital and closing capital amount. Capital amount is ascertained as the excess of assets over liabilities.

What are the 3 different types of Single Entry System:

There are generally 3 different types such as Pure, Simple & Quasi single entry system. This has been explained below. Let us look into it.

1.Pure Single Entry System:

In this system, only personal accounts are maintained. For example, debtors accounts, suppliers accounts or customers accounts. This would help to gather the information relating to customers and suppliers.

But in this system, there no information available relating to cash balance, bank balance, sales amount, purchase amounts. Thus there is no cash and bank balance information available. There is no information regarding sales and purchase amounts as well.

This system or method exists only on paper. This method is not adopted in practical real life as there is no information regarding cash and bank balance.

2.Simple Single Entry System:

In this system, personal accounts and cash book is also maintained. Cashbook is the main register for all transactions. Here cash book gives information relating to assets or liabilities and payments made to suppliers or cash received from customers.

Here, only two accounts are considered. The two accounts are Cash and Personal accounts. This system also follows the rules of the double-entry system. Thereby journal entries are passed only for cash and personal accounts. The other accounts are not considered. The postings are made from cash book to personal accounts and no other accounts to be found in the ledger.

3.Quasi Single Entry System:

In this system, personal accounts along with cash book and subsidiary books are maintained. Here personal accounts, cash book and subsidiary books are maintained.

Under this system, subsidiary books are also maintained. The main subsidiary books maintained are the Sales book, Purchase book, Bills book. This system seems to be the substitute for the double entry system as well.

Conclusion:

Thus, now we can understand, as to, what are the types (methods) of single entry system. The three systems are Pure single entry, Simple and Quasi single entry system as well. These systems are adopted as per the needs and requirements of the organisation

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