Top ads from clicksor

Thursday, May 17, 2012

Types of Petty Cash Book

Simple Petty Cash Book
Simple petty cash book is same as single cash book where only one amount column is maintained in each side of such cash book. Amount received from head cashier is entered on the debit side of cash book and all the petty payments made by petty cashier are recorded in  credit side. Finally, the balance amount is found out.

Analytical Petty Cash Book
Under this system of cash book, a separate column is provided for each type of petty expense in the credit side of cash book. However debit side columns are same as simple column cash book. Number of columns of such petty expenses depends upon the volume of petty transactions. When there is large number of transactions, only most common petty expenses are assembled in the 'miscellaneous expenses' column.

Petty Cash Book

In an organization, there are many petty expenses to be paid in small amount. Taxi fare, cartage, postage and stamps, stationery etc. are some petty expenses for which it is not practicable to issue cheques. On the other hand, it will become very bulky if all these payments are entered in the cash book. Therefore, a petty cashier is given a certain sum of money to make such small payments and s/he enters them in a petty cash book.

Advantages of Petty Cash Book:
  1. Main cashier can utilize his/her time to important work since the petty expenses are recorded by petty cashier.
  2. It reduces the use of cheques and also avoids the inconvenience of issuing cheques for small payments.
  3. There are lesser chances of frauds and errors of all petty expenses due to the regular checking of petty cash book by head cashier.
Imprest System of Petty Cash Book
The work 'imprest' means 'advance amount' given to certain person to make petty payments. It is a system of petty cash book where a person (petty cashier) is given a fixed amount in the beginning of the month or week. He is supposed to make all small payments of petty expenses. At the end of the period say month or week, the vouchers are checked by head cashier and petty cashier is paid as much as he has spent during the period so that he will have the same amount as he had at the beginning of the first period.

Your Luck Goes Here

Search your luck

Search Term:

techorati

Add to Technorati Favorites

jibesh

top100