In accounting, "CF" is a written abbreviation that stands for carried forward.
Understanding Carried Forward (c/f)
The term "carried forward" (c/f) is a common term used in financial documents, specifically when dealing with columns of numbers. It indicates that a total from one page or section is transferred to the next page or section of the document, often to be used in further calculations.
Common Uses of c/f:
- Balance Sheet: When the balance sheet is too long to fit on a single page, totals like total assets, total liabilities, or total equity might be carried forward to the next page.
- Profit and Loss (Income) Statement: A running total of a component of the statement can be carried forward from page to page.
- Ledger Entries: In accounting ledgers, particularly when handling large amounts of transactions, totals are often carried forward from one page to the next.
Practical Example
Imagine a cash book with multiple pages, each detailing cash receipts and cash payments.
- At the bottom of page 1, you might see a running total of the cash balance, along with "c/f".
- At the top of page 2, the carried forward balance is listed, and further transactions will be calculated from this point.
- This process is repeated until the entire accounting period's cash book is recorded.
Benefits of Using c/f
- Accuracy: The use of c/f ensures accuracy in calculations across multiple pages, avoiding manual recalculations for each subsequent page.
- Organization: It helps maintain clear documentation and allows for a logical flow of financial data across multiple sections.
- Continuity: It provides a clear trail of data from one section to another in complex financial reports and ledgers.
Summary
| Term | Meaning | Application |
|---|---|---|
| CF/ c/f | Carried Forward | Transfer of a total from one page or section to another |
