answersLogoWhite

0

What is a petty cash book?

Updated: 9/11/2023
User Avatar

Wiki User

10y ago

Best Answer

Definition and Explanation:

In almost all businesses, it is found necessary to keep small sums of ready money with the cashier or petty cashier for the purpose of meeting small expenses such as postage, telegrams, stationary and office sundries etc. The sum of money so kept in hand generally termed as petty cash and book in which the petty cash expenditures are recorded is termed as petty cash book.

In large business houses , the cashier has to handle every day a large number of receipts and payments and if in addition to this he is further saddled with petty cash payments, his position becomes embarrassing. Besides, it is most common to find with large commercial establishments that all receipts and payments are made through bank. Since expenses like postage, telegrams, traveling etc, cannot be made by means of cheques, the maintenance of a small cash balance to meet these petty payments becomes all the more necessary.

A petty cash book is generally maintained on a columnar basis - a separate column being allotted for each type of expenditure. The is only one money column on the debit side and all sum received from time to time by the petty cashier from the chief cashier are entered in it. The credit side consists of several analysis columns. Every payment made by the petty cashier is entered on this side twice - Firstly it is recorded in the total column and then to the appropriate column to which the expense is concerned. The total of the "total column" will naturally agree with the total of all subsidiary columns. The difference between the total of the debit items and that of the "total column" on the credit side at any time will represent the balance of the petty cash in hand and this should tally with the petty cashier's actual holding of cash.

The posting from the petty cash book to the respective accounts in the ledger are made directly in total at the end of every month or any other fixed period.

User Avatar

Wiki User

10y ago
This answer is:
User Avatar

Add your answer:

Earn +20 pts
Q: What is a petty cash book?
Write your answer...
Submit
Still have questions?
magnify glass
imp
Related questions

Analytical petty cash book?

The petty cash book which is prepared in columnnor form is called anylatical petty cash book


What is called as petty cash book?

petty cash book is the book which is used for the purpose of recording the payment of petty cash expenses.


What is the similarity of cash book and petty cash?

petty


What are the difference of petty cash voucher and petty cash book?

petty cash voucher is released by the handler of the funds to support every payments made. petty cash book contains a summary of all petty cash disbursements, its total and the balance.


Difference between petty cash and main cash book?

cash book is the statement which contain's the total cash information . the information includes "cash in hand & cash at bank" petty cash book is maintain by company to meet their daily expenditure


How can you handle to petty cash?

A petty cash book is used to record miscellaneous transactions


Importance of Petty Cash Book Imprest System?

The importance of Petty Cash Book Imprest System is that it helps in basic bookkeeping. The daily transactions that use the petty cash are entered into this system which ensures that there is proper issuance of petty cash.


What are the types of cash book?

simple cash book petty cash book bank calsh book double cash book


Which cash book is usually maintained by the farmer?

petty cash book


What is the difference between a cash book and a petty cash book?

no ? plze answer say that this question


Explain the imprest system of the petty cash book?

arrey yaar i just want to learn in detail petty cash book


What is petty cash book?

A petty cash book is a book of vouchers which are prepared each time a disbursement is made from petty cash. The voucher would show the date, amount, recipient, purpose and general ledger account number relating to the expense. The person giving out the petty cash and the person receiving the petty cash would sign the voucher and any supporting documentation (such as receipts) would be attached.