Other types of cash may be kept in a drawer, a safe, a cash register or even in the bank if youre using the accounting definition of cash on hand, which measures your companys liquidity rather than the physical dollars you keep handy. Actually, the petty cash book is maintaining each records in chronological order of dates. Besides maintaining a main or general cash book, many companies also maintain a small cash book known as petty cash book to record small day to day expenditures of the business petty cash book is an accounting book used for recording expenses which are small and of little value, for example, stamps, postage and handling, stationery, carriage, daily wages, etc. In this video we will discuss what is petty cash book a subsidiary books in hindi for class 11th cbse icse and state boards and what are the different types. Simple petty cash book this type of book is maintained just like a cash book. Oct 15, 2018 petty cash belongs in your petty cash box or envelope.
There are two primary types of entries in the petty cash book, which are a debit to record cash received by the petty cash clerk usually in a single. Columnar petty cash book, and imprest petty cash book. Download petty cash book excel template exceldatapro. These small expenditures are usually paid using coins and currency notes rather than checks. There are the two methods of preparing petty cash book i. Petty cash book format example definition explanation. The fundamental difference between the main cash book and the petty cash book is that only petty expenses are recorded in the petty cash book. This book is a part of the manual recordkeeping system in the accounting department. However, double column cash book with the discount column is widely used. Stationary, office tea, cleaners wages, postages stamps, local running expense etc. Cash book definition, types accounting format of cash book. A simple petty cash book is identical with a cash book. Petty cash book definition, types, format, examples imprest and.
Simple petty cash book in simple petty cash book there is one column each for recording of receipt of cash from the. Cash book contains cash transactions passing into and out of business. Columnar petty cash book and its preparation process. Types of petty cash book in accounting books, petty. The person who keeps the petty cash book is called the petty cashier. The petty cashier will record this amount on the debit side of the petty cash book while the chief cashier will record the same amount on the credit side of the main cash book.
There are basically two primary types of entries in the petty cash book. What are the different types of petty cash procedures. From the detail type dropdown, choose cash on hand. Mar 23, 2018 in cashbook, we will record the all cash transaction of the business. What is the type of account and normal balance of petty. Simple petty cash book is divided into two sides, a receipt side and a payment side. Petty cash bookmeaning, advantages, format, example. Petty cash book in detail jaiib caiib video study material.
Meaning of petty cash book and advantages of keeping petty. So, the book, wherein day to day petty expenses for a particular period of a business concern, are recorded in chronological order of dates is called petty cash book. This article throws light upon the three main types of cash book that can be maintained in a farm business. Moreover, a cash book is a substitute for cash account in the ledger. A company that properly maintains a cash book does not need to open a cash account in its ledger.
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. In most cases, this petty cash book is a ledger book, and not a computer record. But some other types will be more useful, and give an advantage to. A petty cash book is generally maintained on a columnar basis a separate column being allotted for each type of expenditure. The cashier gives the cash to the petty cash custodian, who includes it in the petty cash fund. Aug 18, 2016 petty cash book concept and types hindi the commerce tutor. Balancing is done the same way as in the case of cash and discount column. Gv commerce classesspecial purpose subsidiary books. When you move cash from your bank account into petty cash, you should see it in this account. Normally the ledger will have receipts recorded on the left hand side debit entry and payments recorded on the right hand side credit entry. Cash includes currency and coins, although most businesses do not keep much of this type of cash around. Petty cash book is a type of cash book that is used to record minor regular expenditures such as office teas, bus fares, fuel, newspapers, cleaning, pins, and. This book keeps the record of all cash payments and cash receipts.
Petty cash book is a ledger book, which is used to record petty cash expenses formally in chronological order, with the date. Cash book ledgers come in many different forms depending on the requirements of the business. Jul 16, 2019 petty cash works on the imprest system, in which there is an initial amount of money put into an account, which is drawn upon for a specific purpose in this case, petty cash. Petty cash book is a type of cash book that is used to record minor regular expenditures such as office teas, bus fares, fuel, newspapers, cleaning, pins, and causal labor etc. Given below is the format of a double column cash book with the discount column.
An analytical petty cash book has two sides is used for recording receipts of the cash and credit side is used for recording payments types of petty cash book. Second part is the cash gross journal which records all cash gross. Any cash, which the petty cashier receives, will be recorded on the debit side left cash column of the book and any cash which he pays out will be recorded on the credit side right cash column of the boo k. Single column cash book, double column cash book, treble column cash book. Petty cash book explanation, format, example, ordinary and. Cash book types of cash book subsidiary books tutor. Since it is an asset, the normal balance of petty cash will show a positive balance or debit balance. Petty cash book type of account petty cash is an asset and is shown under the category of current assets in the balance sheet. Cash or cheque received from the head cashier is recorded in the column of amount received and petty expenses paid recorded in the column of amount paid. Jun 18, 2019 a dual column cash book can be of two types, the one which has cash and discount columns and the other which has cash and bank columns. The larger firms generally divide the cash book into 2 parts. Here we detail about the three types of cash book, i. Petty cash book meaning, types, examples, and faqs.
The credit side consists of several analysis columns. According to the modern rules whenever there is an increase in the value of the asset then the particular asset account is being debited and viceversa. Simple petty cash book is divided into two sides, a receipt side. The petty cash book is the record of petty cash expenditures that are sorted by date. Types of petty cash book in accounting books, petty, cash. Cash is a current asset which consists of items used in day to day financial transactions as medium of exchange. Before talking about the cash book, we would briefly explain what is cash. Petty cash book explanation, format, example, ordinary and imprest. Petty cashier is a person, who maintains the petty cash book. In this book, separate columns are provided for usual head of expenditure. It will be helpful if you understand the various types of petty cash book.
Petty cash book download a template you can start using. When the account goes below a certain specified amount, the system is replenished. Petty cash book helps in making the records of cash transactions uptodate because of the division of labor in recording cash transactions. Generally, simple or open type of petty cash book is widely used in businesses. Cash book types of cash book subsidiary books tutors tips. These balances include savings and checking accounts. At this point, we should note that a petty cash book or ledger is different to a voucher. Simple petty cash book is just like the main cash book. For this purpose, a petty cashier is appointed by the firm, to pay for small payments usually below rs. Types of petty cash book columnar petty cash book and its preparation process imprest petty cash book. Simple petty cash book and analytical petty cash book. Any cash which the petty cashier receives is recorded on the left hand side cash column debit or receipts column and any cash which he pays out is recorded on the right hand side credit or payments column.
Petty expenses the type of expenses usually recorded in the petty cash book include. Petty cash book is an accounting book used for recording expenses which are small and of little value, for example, stamps, postage and handling, stationery, carriage, daily wages, etc these are expenses which are incurred day after day. Systems of petty cash fund notes, videos, qa and tests. Simple cash book prepared like cash account in ledger. This petty cash book is prepared on the same lines of the simple petty cash book. Meaning, types and importance of petty cashbook srd law. What is a cash book definition, explanation and types. A simple petty cash book is one in which there is only one amount column on its both sides with common date and particular column. Oct 25, 2017 small or large companies maintain 2 types of petty cash book for all cash transactions of a business. Petty cash book and types of petty cash book part 1 simple. Jan 24, 2021 a petty cash account is not a type of bank account but more of a fund maintained inside a business.
Simple petty cash book a simple petty cash book is one which there is only one amount column on its both sides with common date and particular columns. The format of simple petty cash book is as under ii. Petty cash book explanation, format, example, ordinary. The cash book containing two money columns cash column and bank column on both sides for recording cash and bank transactions is called a double column cash book. The petty cash amount contains a small amount of cash and is mainly used for purchases when using checks, debit cards or credit cards would be frivolous. Single column cash book is a document which records inward and outward cash transaction of a business without any discounts or tax. Petty cash book makes possible for making a comparison of the petty expenses between two periods and helps in controlling such petty expenses more effectively. Here we discuss the format of petty cash book, types of petty cash systems including the ordinary and imprest system. Also included as a part of cash are the balances kept at banking and financial institutions. A voucher is essentially a receipt or form that you issue every time a payment is made out of the petty cash fund.
All the cash receipts are entered in amount column on debit side and all cash payments are appeared on credit side of the amount column. If there is a petty cash book, the custodian enters the amount of the cash received in the book, and updates the running total of cash on hand. Petty cash book definition, types, format, examples. There are four major types of cash book that companies usually maintain to account for their cash flows. Simple cash book contains only one amount column on each side debit and credit for recording cash receipts and cash payments. Petty cash book is a type of cash book, which use to record small amount of receipts and payment. Cash book is periodically made up with the bank instructions as an internal method of inspecting. Cash received by the petty cashier is recorded on debit side and. It records all the cash and bank receipts and payments. Meaning, types and importance of petty cashbook srd law notes. Petty cash book is a part of accounting cycle it is prepaid for the normal daiy expenditres of the organization. Types of petty cash book generally, there are two types of petty cash book.
Dec 15, 2020 there are two primary types of entries in the petty cash book, which are a debit to record cash received by the petty cash clerk usually in a single block of cash at infrequent intervals, and a large number of credits to reflect cash withdrawals from the petty cash fund. First part is the cash outlay journal that records all cash payments, much as accounts collectable and budget items. The debit column is used for entering the balance of cash in hand of the petty cashier at the beginning of the period. What is the type of account and normal balance of petty cash.
Petty cash book meaning, types, examples, and faqs vedantu. Until reimbursement is made, the expenditures made through petty cash fund should not be posted in the bank cash book. The difference between petty cash and cash on hand bizfluent. Posting of entries from main cash book and petty cash book is comparatively easy. Any cash which the petty cashier receives is recorded on the left hand side cash column debit or receipts column and any cash which he pays out is recorded on the right hand side. The following types of forms are used for operating the petty cash fund. Types of petty cash book columnar petty cash book and its preparation process. Following are the advantages of maintaining petty cash book. The cash can also be used to make change if there is not enough in the cash register. A petty cashier makes a detailed analysis of petty payments and records under suitable heads, i. Two types of petty cash book maintained by small or. In order to gain deep understand, please refer to the petty cash book example below. The only difference is that the payments side ruled into suitable column for recording expenses that are repetitive in nature. Types of petty cash book petty cash book is of two types.
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