PETTY CASH BOOK
CONTENT
- Meaning of Petty Cash Book
- Columns in a Petty Cash Book
- Recording of Receipts and Payments in Petty Cash Book
- Preparation of a Petty Cash Book
- Imprest System, Petty Cash, Reimbursement and Retirement
Meaning of Petty Cash Book
This is used to record small expenses such as postage stamps, envelops, transport fares, newspapers, stationery and other small items needed in the office. The word ‘petty’ means small. We cannot pay for them with cheques because they are too small. It is also a book of original entry and also a ledger account for petty cash. The cost of each of the small items is recorded in the petty cash book instead of the ledger. The total expenses are transferred to the ledger as a petty cash account.
Columns in a Petty Cash Book
DEBIT SIDE
- Amount
- Date
- Particulars of expenses
- Voucher number
- Total amount
CREDIT SIDE
On the credit side we have the analysis of expenses of a ledger account.
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