Question
What is a Petty Cash Book?

Answer

Petty Cash Book is the book which is used for the purpose of recording expenses involving small amounts. Besides petty expenses, receipts from main cashier are recorded. Petty Cash Book is like Petty Cash Account and is maintained by Petty Cashier.

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International Financial Reporting Standards (IFRS) provides a number of benefits. Explain any three.
What are errors of Omission?
How does the Matching Principle apply to depreciation?
Show the accounting equation on the basis of the following transactions and also show the Balance Sheet:
  1. Started business with Cash ₹ 60,000 and Goods ₹ 30,000.
  2. Purchased goods for Cash ₹ 40,000 and on Credit ₹ 25,000.
  3. Goods costing ₹ 48,000 sold at a profit of $33\frac{1}{3}\%.$ Three-fourth payment received in Cash.
  4. Goods costing ₹ 20,000 sold at a loss of 5%, out of which ₹ 12,000 received in Cash.
  5. Paid Rent ₹ 4,000 and Salary ₹ 6,000.
  6. Received Cash from Debtors ₹ 15,000.
  7. Paid telephone bill amounting to ₹ 800.
Give one example of error of Omission?
Journalise the following transactions in the Journal of M/s. Gupta Brothers (Prop. Shri R. K. Gupta), Delhi and post them to the Ledger:
2019
 
March 1
Started business with cash
2,00,000
March 2
Opened bank account with SBI
80,000
March 4
Goods purchased from Raj, Jaipur (Rajasthan)
22,000
March 5
Goods purchased for cash
30,000
March 8
Goods sold to Naman, Delhi
12,000
March 10
Cash paid to Raj
22,000
March 15
Cash received from Naman
11,700
Discount allowed
300
March 16
Paid wages
200
March 18
Furniture purchased for office use
5,000
March 20
Withdrawn from bank for personal use
4,000
March 22
Issued cheque for rent
3,000
March 23
Goods taken for household purpose. These goods were purchased from Raj
2,000
March 24
Drawn cash from bank for office use
6,000
March 26
Commission received
1,000
March 27
Bank charges
300
March 28
Cheque issued for life insurance premium of Proprietor
3,000
March 29
Paid salary
10,000
March 30
Cash sales
20,000
Open 'T' shape account for Furniture and write the following on the proper side∶
  1. Furniture purchased for ₹ 50,000
  2. Furniture sold costing ₹ 20,000
  3. Furniture destroyed by fire ₹ 16,000
  4. Furniture again purchased ₹ 32,000
  5. Old furniture discarded ₹ 2,000
  6. Value of furniture was reduced by ₹ 5,000
Why the full cost of an asset is not treated as an expense in the year of its purchase?
Explain the following:
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Distinguish between ‘provision’ and ‘reserve’.