Dear Sir,

I am preparing income and expenditure account of private indian school and my profit is arising around 630000/- and cash account is Rs.928265/-Debit balance want to reduce profit around 63000/- and cash account to Rs.78000/-. Please solve it .

To reduce your cash account you just simply spend money on things like equipment, supplies, expenses, or just withdraw the money for personal use.

To reduce your profits simply reduce your revenues by lowering your fees per student or decreasing the number of students that attend the school or you can increase your expenses like raising the salaries for teachers and workers at the school.

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Originally Posted by pready

To reduce your cash account you just simply spend money on things like equipment, supplies, expenses, or just withdraw the money for personal use.

To reduce your profits simply reduce your revenues by lowering your fees per student or decreasing the number of students that attend the school or you can increase your expenses like raising the salaries for teachers and workers at the school.

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I want to reduce cash amount without affecting into profit account. Give your solution. If i reduce the cash account by spending money on above than the profit will become low and it comes to loss situation.

Cash does not affect the profit of a company. Profit is Revenues minus Expenses. Also cash is a balance sheet account and profit is known as Net Income and it comes from the Income Statement or another name is the Profit and Loss Statement. Profit flows through to the balance sheet as Retained Earnings.