1. Petty Cash Book

2. What is petty cash book ?
As the cash book lists bank payments & receipts, a petty cash book is needed to record actual cash transactions.

3. Voucher is a form which shows what a payment is for .

4. Imprest system
Imprest systems is a system by which a refund is made of the total paid out in a period.

5. A worked example of a petty cash book:
Step Enter date and details of each payment .Put in the
total column.
Step For step 1 also put the amount in the column for the
type of expense.
Step At the end of each period,add up the totals column
Step Now add up each of the expense columns. The total
of Step 3 should equal the total of all the expense
column
Step Then balance off the petty cash book ,carrying down the petty cash in hand balance to the next period

6. For example:
Write up a petty cash book,with analysis columns for office expenses,motor expenses ,cleaning expenses and casual labour.The cash float brought down is $600 and the amount spent is reimbursed on 28 Feb.Show the balance carried down to 1 March .
Year $
Feb 1 Letterheadings
2 F.Lee-casual labour
2 Unique Motors- motor repairs
4 Petrol
5 Paper clips
8 Envelopes
9 Cleaning materials
11 C.Hop- casual labour
13 Mr.Ng-cleaner
16 Typewriter ribbons
18 Motor taxation
21 K.Kwan - casual labour
Also show how the items for motor expenses and office expenses would appear in the general ledger.

7. Petty Cash Book

8. General Ledger Motor Expenses Year 8 $ Year 8 $ Feb 28 Petty cash 120
Office expenses
Year $
Feb Petty cash

9. Now you know how to prepare a petty cash book ???
Let's try try !!!!

10. Exercise 29 Postage Voucher No. 10 6.3
Year 3
May The cashier hands a cheque for$100 to the petty
cashier to enable him to obtain cash for the
starting float of petty cash $
3 Stationery Voucher No
5 Postage Voucher No
8 Cleaning expenses Voucher No
12 Payment of amount to K Sutton in the
purchases ledger Voucher No
17 Postage Voucher No
20 S-Small- travel exp Voucher No
23 Stationery Voucher No
25 Cleaning expenses Voucher No
27 Telephone phone bill Voucher No
29 Postage Voucher No
31 The cashier reimburses the petty cashier the amount paid out to date

11. Answer

12. General Ledger Postage Year 3 $ May 31 Petty cash 21.3 Stationery
Travel Exp.
Year $
May 31 Petty Cash 4.5
Cleaning
May 31 Petty Cash

13. General Ledger Purchases Ledger Bank Year 3 $ May 1 Petty Cash 100
Jun Petty Cash
K Sutton
Year $
May 31 Petty Cash
Purchases Ledger

14. Revision Notes
The petty cash book saves 1) the main cash book 2)the ledger accounts from containing a lot of trivial details
The use of the petty cash book enables the chief cashier to delegate this type of work to a more junior member of staff
Under the imprest system,at the end of a period ,the cashier reimburses the petty cashier the amount spent in the that period ,so as to make up the cash float.

15. The End