Tag: petty cash book

Questions Related to petty cash book

When using a petty cash system, the replenishment of the fund would normally include a debit to _______________.

commercial studies subsidiary books - 2 petty cash book meaning, importance and components of voucher bank book and petty cash book

  1. Cash.

  2. Petty Cash.

  3. Revenues.

  4. None of the above

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Correct Option: A

Payments in cash of small amounts like travelling expenses, postage, carriage,etc. are recorded in the ______________.

commercial studies subsidiary books - 2 petty cash book meaning, importance and components of voucher bank book and petty cash book

  1. Main Cash Book

  2. Petty Cash Book

  3. Cash Budget

  4. Journal proper

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Correct Option: B

Which of the following is not a column of a three-column cash book ? 

commercial studies subsidiary books - 2 petty cash book meaning, importance and components of voucher bank book and petty cash book

  1. Discount Column

  2. Petty Cash Column

  3. Bank Column

  4. Cash Column

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Correct Option: B

The balance in the petty cash book is __________.

commercial studies subsidiary books - 2 petty cash book meaning, importance and components of voucher bank book and petty cash book

  1. A liability

  2. An asset

  3. A profit

  4. An expense

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Correct Option: B

Perpetual inventory system involves ____________.

elements of accounts cash book and its types petty cash book meaning, importance and components of voucher bank book and petty cash book

  1. bincard and stores ledger

  2. bill of material and material requisition

  3. purchase requisition and purchase order

  4. inward and outward invoices

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Correct Option: A

The amount paid to the petty cashier at the beginning of a period is known as __________ amount.

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Imprest

  2. Credit

  3. Idle

  4. None of these

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Correct Option: A
Explanation:
Imprest - It is a fund used by a business for small items of expenditure, and restored to a fixed amount periodically.
Hence, a petty cash book is kept on the imprest amount.

Which of the following statements is/are true ? 
(i) Cash book records all cash receipts and cash payments
(ii) Cash book records all sale and purchase transactions of goods both in cash and on credit.
(iii) Cash book records discount on cash payments
Select the correct answer from the options given below :-

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Only (i) of the above

  2. Only (ii) of the above

  3. Only (iii) of the above

  4. Both (i) and (iii) of the above

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Correct Option: D

Petty Cash Book may be treated as a ___________________.

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Part of the double entry system

  2. Merely as a memoranda book

  3. Either (A) or (B)

  4. None of the above

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Correct Option: C

Which of the following statement is false?
The petty cash book  ____________. 

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. is a book of prime entry

  2. records cheques paid and received

  3. is written up using petty cash receipts and petty cash vouchers

  4. records cash received and paid

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Correct Option: B

Petty cash fund is supposed to be replenished at ________________. 

elements of book keeping and accountancy recording and posting of cash transactions understand the concept of imprest system petty cash book bank book and petty cash book

  1. Every day

  2. Every half year

  3. Every Year

  4. At the end of every accounting period

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Correct Option: D
Explanation:

Petty cash fund is supposed to be replenished at the end of every accounting period.

This is done whenever the amount of actual cash in the petty cash box is low and at the end of each accounting period.