What is the function of a cash book in accounting?

The cash book serves a critical function in accounting by tracking all cash and bank transactions. This includes both cash receipts and cash payments, providing a comprehensive view of the organization's liquidity and cash flow management. By recording these transactions, a cash book enables businesses to monitor their cash position accurately, ensuring they can meet financial obligations and make informed decisions regarding expenditures and investments.

The cash book is unique as it acts as both a journal and a ledger for cash transactions, allowing for easy reconciliation with bank statements and facilitating better financial oversight.

In the context of the other options, recording only sales transactions is too narrow a focus and does not encompass the full range of cash activity that a cash book captures. Summarizing financial statements pertains to higher-level accounting functions, while recording accounts payable relates to liabilities, which are typically documented in a separate accounts payable ledger. Thus, the cash book's primary role remains comprehensive tracking of cash and bank transactions.