Books of Prime Entry
Petty Cash Book
Petty Cash Book questions test your ability to record small payments using the imprest system, restore the imprest amount, and analyse petty cash transactions. Usually 8–10 marks per paper.
Always restore the imprest correctly — the amount restored equals total payments made. Common mistakes: recording receipts on the wrong side, forgetting to show the balance carried down, and missing the restoration entry.
Key Concepts to Revise
The Imprest System
A fixed float is set. At period end it is restored to the original amount by the main cashier.
Recording Payments
Only payments are recorded — small expenses like postage, stationery and travel. No receipts except the restoration.
Analysis Columns
Payments are split into categories. Each column total is posted to the relevant expense account in the ledger.
Restoring the Float
Restoration = total payments made in the period. This brings cash back up to the imprest amount.