A cash book is a record of all the cash that comes into and goes out of your business each day. Cash in includes sales and payments received, and cash out includes purchases, rent, salaries and daily costs. The difference is your closing cash balance, which should match the money actually in your drawer or box at the end of the day.

How is a cash book different from a khata?

A cash book tracks physical cash movement day by day and ends with a cash balance. A khata tracks credit between you and specific customers or suppliers, showing who owes whom. You use both together: the cash book for daily cash flow, and the khata for udhaar. Many apps, including IndiaCRM, keep both.

Can I record UPI payments in a cash book app?

Yes. A modern cash book app lets you tag each entry as cash, UPI or bank, so you can separate the money in your drawer from the money in your account. This matters because your physical cash balance and your bank balance are different pots, and mixing them hides errors.

Why should I keep a daily cash book?

It tells you whether the cash in hand matches the cash you should have, which quickly reveals leaks, mistakes or theft. It also shows where your money goes, so you can control spending. Without a daily cash book, small unexplained shortfalls add up unnoticed over a month.

Is a cash book app free?

Many are free for basic daily recording. IndiaCRM includes cash and expense tracking free alongside GST invoicing and digital khata. Check any app for hidden limits, but simple daily cash books are commonly available at no cost.

Cash Book and Daily Expense App for Business (2026)

Cash is still king for millions of Indian businesses. Sales come in as notes and UPI, expenses go out for stock, rent, tea and wages, and at the end of the day the money in the drawer should match what you expect. When it does not, you rarely know why, because the entries were never written down. A cash book fixes that. It is the oldest and simplest tool in accounting, a running record of cash in and cash out, and a cash book app puts it on your phone with the totals done for you. This guide explains what a cash book is, how to keep one, and how a mobile app makes daily expense tracking simple for any Indian business.

What is a cash book?

A cash book records every rupee that enters and leaves your business as cash or immediate payment. It has two sides in spirit: money coming in, and money going out. Money in covers your sales and any payments you receive. Money out covers purchases, rent, salaries, transport and the small daily costs that are easy to forget. You start the day with an opening balance, add the cash in, subtract the cash out, and arrive at a closing balance. That closing figure should equal the actual cash in your drawer. When the two match, your records are clean. When they do not, you have found a mistake early, while you can still explain it.

Cash book vs khata

People sometimes confuse a cash book with a khata, but they do different jobs. A cash book follows physical money day by day. A khata follows credit between you and named customers or suppliers. You raise udhaar in the khata and record actual cash movement in the cash book. Used together they give a full picture: the cash book shows your daily liquidity, and the bahi khata shows who still owes you money.

Recording daily cash in and cash out

The routine is quick once it becomes a habit. Each entry needs only a few details.

Date and time: Recorded automatically by the app, so every entry is in order.
In or out: Whether the money came in or went out.
Amount: The rupee figure.
Mode: Cash, UPI or bank, so you can keep your drawer separate from your account.
A short note: What it was for, such as stock, rent or a sale, so the entry makes sense later.

A sample cash book layout

Here is how a single day looks in a simple cash book. The running balance updates after each entry, and the closing balance is what should be in your drawer at close of business.

  CASH BOOK  -  15 August 2026
  ------------------------------------------------
  Opening balance                        3,500.00
  ------------------------------------------------
  TIME   PARTICULARS        IN        OUT   BALANCE
  ------------------------------------------------
  09:20  Sale (cash)      1,200         -   4,700.00
  10:05  Stock purchase       -     2,000   2,700.00
  11:40  Sale (UPI)         850         -   3,550.00
  13:15  Tea + snacks         -       120   3,430.00
  15:30  Sale (cash)      2,400         -   5,830.00
  17:00  Staff advance        -     1,000   4,830.00
  18:45  Sale (cash)        600         -   5,430.00
  ------------------------------------------------
  Totals               5,050     3,240
  ------------------------------------------------
  Closing balance                        5,430.00
  ================================================

At close, you count the notes in your drawer. If it comes to 5,430 rupees you are balanced. If not, you check the day's entries while the transactions are still fresh in mind.

Get the free IndiaCRM app

IndiaCRM does GST invoicing, digital khata and payment tracking in one free app for iPhone and Android. Download the app or see GST billing.

Common daily expenses to record

The entries that get missed are almost always the small ones, and small ones add up. To keep your cash book honest, make a habit of recording these routine outflows the moment they happen.

Stock and raw material: The biggest and most regular outflow for most shops and workshops.
Rent and utilities: Shop rent, electricity and water, even when paid monthly, belong in the book on the day they leave your cash.
Wages and advances: Daily or weekly staff payments and the small advances that are easy to forget.
Transport and delivery: Auto fare, petrol, courier and loading charges.
Small costs: Tea, packing material, repairs and other minor spends that quietly drain cash if never noted.

When every one of these lands in the cash book, your closing balance becomes a real test of accuracy rather than a rough guess. That is the whole point of keeping the book.

Why a running balance matters

The single most useful number in a cash book is the running balance, because it lets you catch problems the same day. A shortfall of a few hundred rupees is easy to trace when you notice it in the evening and almost impossible a week later. Over a month, small unexplained gaps add up to real money. A cash book with a live balance turns a vague sense that cash is tight into a precise figure you can act on. It also settles the common end-of-day question of whether you can afford to bank surplus cash or need to hold it back for tomorrow's purchases.

It also helps to close and check the book at a fixed time every day, usually at the end of trading. Counting the drawer against the closing balance while the day is fresh means any gap is easy to explain, whether it is a missed entry, wrong change given, or a payment recorded twice. Make this a two-minute ritual rather than a monthly panic, and your cash book stays trustworthy without much effort. Over time you will also notice your typical daily float, which tells you how much cash to keep on hand and how much to bank.

Doing it on mobile

A paper cash book means carrying a register and adding columns by hand. A cash book app on your phone removes both chores. You record an entry the instant money changes hands, the balance updates itself, and nothing is lost if the phone breaks because the data is saved online. You can tag entries as cash, UPI or bank, so your physical cash and your account balance stay separate and honest. Reports then show where your money went over a week or a month, which is the first step to controlling spending. Here is how the two compare.

Bringing it together

A daily cash book is the habit that keeps a small business honest with itself. Pair it with a digital khata for credit and GST invoices for sales, and you have a complete, low-effort accounting system on one phone. The IndiaCRM app includes cash and expense tracking, khata and GST billing free. To see the wider picture, read our guides to cloud accounting software and free accounting software.