Petty Cash Book – Meaning, Cash Book Vs petty cash Book

Petty Cash Book: The cash book as seen above is used for tape-recording all major payments. In every business, a number of petty (little) Payments like that for postage, carriage, stationery, home entertainment, cartage, conveyance etc. are paid regularly even in a single day. If all these petty expenses are to be tape-recorded in the main cash book. It would be come too large and difficult to handle therefore, it is normal for business systems to preserve a separate cash book to tape little payments just. Such a money book is called petty-cash book. Petty money book can be of two types.

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  • a) Easy petty cash book and
  • b) Analytical petty cash-book.

Material in this Article.

Petty Money Book

1.) BASIC PETTY CASH BOOK:–LRB- A basic petty-cash book is composed much like the money book. The amount gotten by the minor cashier from the head cashier is recorded on the debit side of the petty-cash book and payment on the credit side of the minor cash-book. Expenses account is individually debited in the journal.

AN ANALYTICAL PETTY MONEY BOOK:–LRB- An Analytical petty cash book is utilized by a big concern having a number of deals of petty amount such petty. Money book consists of individual columns for each expense every little payment is tape-recorded on the credit side. Concerned while the total of payment column serves to discover out the balance of cash with the petty cashier.

Cash Book Vs minor money Book

The primary distinction between minor cash book and main money book is that petty expenses are taped in the minor cash book.

It is another Cash Book which is maintained, usually, in big service issues to reduce the concern of ‘Main Money Book’, in which many deals including petty (small) amounts are tape-recorded. For this purpose, a Petty Cashier is selected by the Chief Cashier. The Chief Cashier advances an amount of money to the Petty Cashier to enable him to satisfy petty costs for a set duration

Types of the minor money book

Basic minor cash Book

Amount LF Date Particular Coupon No Quantity

Advantages of Petty Cash Book

  • It eases the money book of numerous entries for small payments.
  • It conserves the chief cashiers time because a junior handles these minor payments.
  • It conserves labour to a considerable degree as it allows the regular monthly overalls to be posted to the journal instead of day-to-day information.
  • It establishes and trains young staff.
  • Effective control can be exercised over small payments since the chief cashier checks the payment and the supporting coupons periodically.
  • It even conserves time due to the fact that rather of making the entry in each ledger a transaction is tape-recorded in a specific head at a time.
  • It makes money transactions more clear and transparent for the accountancy propose.
  • It makes a recording of cash transaction up to date and clear.
  • It assists in managing money expenses in 2 periods and make it enhances efficiency in cash management.


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