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Questions and Answers
What is the total amount received in the Analytical Petty Cash Book?
How much was spent on Packing Charges as per the records?
Which account does the advance given to Mr. Shrikant appear in?
What was the total spent in Telegrams as per the Petty Cash Book?
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What is the closing balance carried down on November 1st?
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How much was spent on Printing Charges?
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What is the formula used to calculate the closing balance?
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Which of the following is NOT a type of expense recorded in the Petty Cash Book?
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Study Notes
Petty Cash Book
- The petty cash book is used to record small expenses that are paid out of a small amount of cash kept on hand.
- The book has two sides: the debit side and the credit side.
- The debit side records the amount of cash received.
- The credit side records the amount of cash paid out.
- The petty cash book is also used to track the balance of cash on hand.
Example of a Petty Cash Book
- The example shows a petty cash book for the month of October 2011.
- The book shows the following information:
- The date of each transaction.
- The amount of cash received.
- The amount of cash paid out.
- The purpose of each payment.
Key Points
- The total amount of cash received in the example is 1,350.
- The total amount of cash paid out is 1,217.
- The balance of cash on hand at the end of the month is 133.
- The closing balance is calculated as the amount received less the total amount spent.
Transactions
- The transaction dated October 18, 2011, involves an advance given to clerk Mr. Shrikant.
- This transaction should be recorded in the Ledger Account column because it is a personal account.
Conclusion
- The petty cash book is an important tool for businesses of all sizes.
- It helps to track cash receipts and disbursements and to maintain a record of small expenses.
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Description
This quiz covers the fundamentals of the petty cash book, including its structure, function, and practical examples. Participants will learn how to record small expenses and track cash balance effectively. A key focus is on understanding the debit and credit sides of the petty cash book.
