Prepare petty cash book from the following transactions. The imprest amount is ₹2,000. 2017 January 01 Paid cartage 50 02 STD charges 40 02 Bus fare 20 03 Postage 30 04 Refreshment for employees 80 06 Courier charges 30 08 Refreshment of customer 50 10 Cartage 35 15 Taxi fare to manager 70 18 Stationery 65 20 Bus fare 10 22 Fax charges 30 25 Telegrams charges 35 27 Postage stamps 200 29 Repair on furniture 105 30 Laundry expenses 115 31 Miscellaneous expenses 100
Petty Cash Book
| Amount Received | Date | Particulars | V.No. | Amount Paid | Postage | Telephone & Telegram | Conveyance | Stationery | Misc. |
|---|---|---|---|---|---|---|---|---|---|
| 2,000 | 2017 Jan 01 | Cash Received | |||||||
| Jan 01 | Cartage | 1 | 50 | 50 | |||||
| Jan 02 | STD charges | 2 | 40 | 40 | |||||
| Jan 02 | Bus fare | 3 | 20 | 20 | |||||
| Jan 03 | Postage | 4 | 30 | 30 | |||||
| Jan 04 | Refreshment for employees | 5 | 80 | 80 | |||||
| Jan 06 | Courier charges | 6 | 30 | 30 | |||||
| Jan 08 | Refreshment of customer | 7 | 50 | 50 | |||||
| Jan 10 | Cartage | 8 | 35 | 35 | |||||
| Jan 15 | Taxi fare to manager | 9 | 70 | 70 | |||||
| Jan 18 | Stationery | 10 | 65 | 65 | |||||
| Jan 20 | Bus fare | 11 | 10 | 10 | |||||
| Jan 22 | Fax charges | 12 | 30 | 30 | |||||
| Jan 25 | Telegrams charges | 13 | 35 | 35 | |||||
| Jan 27 | Postage stamps | 14 | 200 | 200 | |||||
| Jan 29 | Repair on furniture | 15 | 105 | 105 | |||||
| Jan 30 | Laundry expenses | 16 | 115 | 115 | |||||
| Jan 31 | Miscellaneous expenses | 17 | 100 | 100 | |||||
| Total | 1,065 | 260 | 105 | 185 | 65 | 450 | |||
| Balance c/d | 935 | ||||||||
| 2,000 | Total | 2,000 |
Note:
- Postage: 30 + 30 + 200 = ₹260
- Telephone & Telegram: 40 + 30 + 35 = ₹105
- Conveyance: 50 + 20 + 35 + 70 + 10 = ₹185
- Stationery: ₹65
- Miscellaneous: 80 + 50 + 105 + 115 + 100 = ₹450
- Total Expenditure: ₹1,065
- Balance: 2,000 (Imprest) - 1,065 = ₹935
Explanation
The Petty Cash Book is prepared using the Imprest System, where the petty cashier starts with a fixed amount (₹2,000). At the end of the period, the amount spent (₹1,065) is reimbursed to restore the balance to the imprest amount.
Expenses are categorized into specific analysis columns to organize small payments:
- Postage & Courier: Includes postal stamps and courier fees.
- Telephone & Telegram: Covers STD and fax charges.
- Conveyance: Includes cartage, bus fares, and taxi fares.
- Stationery: For office supplies.
- Miscellaneous: For varied expenses like refreshments, repairs, and laundry.
The final cash balance is calculated by deducting the total payments from the amount received.
Solution Steps
Step 1: Record the opening imprest amount of ₹2,000 on the receipt side.
Step 2: Enter each transaction chronologically on the payment side, allocating amounts to the correct analysis columns (e.g., Cartage to Conveyance, STD charges to Telephone).
Step 3: Total each analysis column individually and verify that the sum of all analysis columns equals the 'Amount Paid' total (₹1,065).
Step 4: Calculate the Balance c/d by subtracting the Total Payments from the Imprest Amount (₹2,000 - ₹1,065 = ₹935).