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How transactions are entered in a petty cash book?
We will understand how to enter the transactions in a petty cash book with the help of two examples which are given below.
Example 1
Transactions for July, petty cashier gets Rs.300/- in advance
July 2 Paid for kitchen supplies Rs. 40/-
July 5 Paid for birthday cake Rs.95/-
July 10 Paid for lunch Rs.85/-
July 25 Paid for taxi fare Rs. 35/-
July 28 Paid for paper Rs.8/-
Solution
The solution is as follows −
| Date | Description | Quantity | Purchase amount | Balance |
|---|---|---|---|---|
| July 1 |
|
|
|
300 |
| July 2 |
Kitchen suppliers |
1 |
40 |
260 |
| July 5 |
Birthday cake |
1 |
95 |
165 |
| July 10 |
Lunch |
1 |
85 |
80 |
| July 25 |
Taxi fare |
1 |
35 |
45 |
| July 28 |
Paper |
1 |
8 |
37 |
Example 2
A company distributes petty cash as follows −
| Postage | $ 5.50 |
| Pizza (meeting) | $40.25 |
| Office supplies | $12.25 |
Solution
Now, all postage, meals and entertainment and office supplies are debited and the same is credited in a petty cash account.
| Account | Particulars/notes | Debit ($) | Credit ($) |
|---|---|---|---|
| Postage |
For business purpose during current period |
5.50 |
|
| Meals and entertainment |
|
40.25 |
|
| Office supplies |
|
12.25 |
|
| Petty cash |
|
|
58.00 |
Updated on: 2021-07-09T12:36:24+05:30
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