ABFA1153 FINANCIAL ACCOUNTING I 1

Tutorial 6 – The Petty Cash

Section 1: Multiple choice questions

1. A petty cash 5. The Imprest System is used to operate the petty cash. The opening
balance is RM200. Total payments from petty cash from the period were
A. A large amount of float maintained by Petty Cashier RM 134. What is the amount of reimbursement to petty cash at the end
B. A large amount of float maintained by Cashier. of the period?
C. A small amount of float maintained by Petty Cashier
D. A small amount of float maintained by Cashier A. RM 200
B. RM 66
2. All of the following statements are true about the Petty Cash Book, C. RM 334
except: D. RM 134
A. It is a part of the double-entry book-keeping system
B. It is used to record payment of suppliers’ invoices 6. The ledger entries that are made every time the petty cashier is
C. It is a book of original entry reimbursed are
D. It is used to record payments of small expenses
Debit Credit
3. Which of the following would be used as source document(s) for a Petty A. Petty Cash Account Imprest Account
Cash Book? B. Petty Cash Account Cash Account
I. Cheque counterfoil to draw money for office use from bank C. Cash Account Petty Cash Account
account. D. Imprest Account Petty Cash Account
II. Debit note from the insurance company
III. Petty cash voucher 7. The imprest system is
IV. Credit note from supplier
A. An amount topped-up to the petty cash book
A. I and II B. A process where a cashier gives the petty cashier money to topped-
B. I and IV up to the original petty cash float amount.
C. I and III C. Combination of cash book & petty cash book
D. III only D. One of the ledger account the General Ledger

4. The credit entries in the Petty Cash Book are posted to the ledger as

A. Debit entries for expenses

B. Credit entries for expenses
C. Debit entries for cash
D. Credit entries for cash
ABFA1153 FINANCIAL ACCOUNTING I 2

Section 2: The Petty Cash Cycle Section 3: The General Journal Cycle

Question 1: Question 1:
Draw up a Petty Cash Book with analysis columns of the following items:
(a) Carriage (b) Stationery (c) Postage The following are the transactions for Hassan Trading, a biscuit distributor,
for the month of April.
Mar 1 Received from chief cashier RM 50 to start a petty cash float
Mar 1 Paid for mineral postage RM 7.50 2 Brought an old computer, valued at RM1,500, from home into the
Mar 3 Paid for pens RM 6.80 business.
Mar 4 Paid for taxi fare RM 4.20 9 Purchased paper for office use RM144 on credit from Syarikat LN.
Mar 6 Paid for stamps RM 2 11 Took a tin of biscuits RM50 to bring home.
Mar 9 Paid for A4 paper RM 4.50 19 Acquired a second-hand van RM10,000 from Min Motor on credit
Mar 10 Paid for telegrams RM 5 term of 90 days.
Mar 12 Paid for posting parcels RM 5 24 Sold an old set of business furniture at book value RM9,000 to
Mar 15 Paid reimbursement of mileage RM 12 Chop Soon Lee on credit term of 7 days.
29 5 tins of biscuits, at RM30 each tin, are distributed as free samples
to customers (as part of a promotion activity).
Biscuits
30 Biscuits amounting RM73 was taken from the business to be given
Questions 2 (BL, 173) as donation to an orphanage.
30 A quarter of the insurance totalling RM800 is for personal house
The following is an incomplete summary of Cheng’s petty cash transactions insurance.
for the period 16 to 30 June. Assume that Cheng uses the Imprest System to
manage the petty cash fund. Draw up the Petty Cash Book with an analysis Required:
column of (i) Office expenses (ii) Postage (iii) Miscellaneous (a) Record the above transactions in the General Journal.
RM (b) Post them to the General Ledger.
Jun 16 Balance of petty cash in hand 84
Cash received to restore imprest of RM200 (i) ?
18 Paid for courier charges 15
19 Donation to Warrior’s Day Fund 20
20 Paid for postage 5
27 Paid for office cleaning 40
29 Paid for detergent, brushes and gloves 12
30 Balance petty cash book and reimbursement received (ii)?

Post to appropriate accounts in the ledger at the end of the period.

ABFA1153 FINANCIAL ACCOUNTING I 3

Section 4: Extra exercise questions (for students’ own practice)

Question 1
Prepare a petty cash book with analysis columns for office expenses, motor 26 Photocopy repair 34.40
expenses, cleaning expenses and casual labour. The cash float is RM 1,000 27 Postage stamps 11.50
and the amount spent is reimbursed on 30 November 27 Office boy services (outsourced) 7.70
Petrol WAY44 10.00
2014 RM (a) Write up the petty cash book to record relevant analysis as
Nov 1 Siti – casual labour 10.00 indicated.
Envelopes 4.80 (b) Balance the petty cash book on 30 November 2014 and carry down
2 Jif – cleaning liquid 4.20 the balance
Adhesive tapes 6.80 (c) Make the entry on 1 December 2014 to restore the petty cash
3 Paper clips 1.40 imprest amount.
4 Petrol WAY 44 5.00
5 May – casual labour 10.00 Questions 2 (CC, 46)
6 Nathan casual labour 10.00 Frederick Bortoli is a sole trader who keeps an analysed petty cash book on
7 A4 copy papers 14.30 the imprest system. The imprest amount is RM 200. His transactions for the
Pens 7.20 month of April were as follows:
8 Andy 22.00 RM
9 Change oil 12.00 April 1 Petty cash in hand 28
10 Motor tax 8.00 Petty cash restored to imprest amount ??
11 A4 Paper 2.20 6 Bought office stationery 14
12 White coffee 13.90 12 Paid travelling expenses 24
13 A3 copy papers 10.70 14 Paid cleaner’s wages 40
14 Sponge and cleaning liquid 14.35 16 Bought postage stamps 18
15 Wipers 28.90 18 Bought typing papers 28
16 Tim – casual labour 15.00 21 Paid cleaner’s wages 40
Sakdon – casual labour 15.00 25 Bought postage stamps 6
18 Carbon papers 5.40 28 Paid travelling expenses 8
20 Cardboard files 3.5” 3.60
21 Rubber bands 11.20 (a) Write up Frederick’s petty cash book to record his transactions. The
22 Petrol BAB 12 5.00 book should have analysis columns for:
23 Broom, brushes and soap 24.60  Stationery
24 Printer ribbon 26.60  Cleaning
25 Taxi fare 12.20  Travel expenses
 Postage
ABFA1153 FINANCIAL ACCOUNTING I 4

Question 3

The following are the transactions of Lim’s Cafe who is just started business
in month of May.

Date Transaction
May Start in business with RM150,000 cash in the bank
1
5 Lim, the owner, brought in his computer worth RM3000 into
business.
13 Took some coffee powder worth of RM50 from the cafe for his
friend as a gift.
17 Bought a coffee machine from Dr Café outlet amounting RM5,500
20 Took 10 boxes coffee powder @RM50each for tasting sample.
25 Office rental of RM 2800, but Lim occupied half of the shop for
his own stay.
30 Bought furniture from Lozenzo Furniture amounting to RM8,900.

(i) Record the transactions to the General Journal

(ii) Post all the transactions from General Journal to General Ledger
ABFA1153 FINANCIAL ACCOUNTING I 5

Tutorial 6: Suggested solutions Question 2

Section 1 – (MCQ) Petty Cash Book
1. C Date Particulars Voucher Receipt Payment Analysis
2. B
June   No Dr Cr Office Exp Postage Misc
3. D
4. A 16 Balance b/d 84
5. D 16 Cash 116
6. B 18 Courier 1 15 15
7. B 19 Donation 2 20 20
20 Postage 3 5 5
Section 2
Question 1 27 Office cleaning 4 40 40
29 Office cleaning 5 12 12

Petty Cash Book 92 52 20 20

Date Particulars Voucher Receipt Payment Analysis 30 Balance c/d 108

Mar   No Dr Cr Carriage Stationery Postage 200 200
1 Cash 50 Jul-01 Balance b/d 108
1 Postage 1 7.5 7.5 Cash 92
3 Pens 2 6.8 6.8
4 Taxi fare 3 4.2 4.2 General Ledger
6 Stamps 4 2 2
9 A4 paper 5 4.5 4.5
Office Expenses Account
June RM RM
10 Telegrams 6 5 5
30 Petty Cash 52
12 Parcels 7 5 5
15 Mileage 8 12 12 Postage Account
47 16.2 11.3 19.5 June RM
30 Petty Cash 20
31 Bal c/d 3
50 50 Miscellaneous Account
Apr- June RM RM
01 Bal b/d 3
30 Petty Cash 20
Bank 47
ABFA1153 FINANCIAL ACCOUNTING I 6

Section 3 (b) General Ledger

Question 1
Capital Account
(a) General Journal Dr (RM) Cr (RM) Apr RM
2 Office Equipment 1500
Apr 2 Dr Office equipment 1,500
Cr Capital 1,500
Brought personal computer into business. Office Equipment Account
9 Dr Stationery 144 Apr RM
Cr Other payables: Syarikat LN 144 2 Capital 1,500
Purchased stationery on credit term.
11 Dr Drawings 50 Stationery Account
Cr Purchases 50 Apr RM
Took inventories for personal use. Other Payables:
9 144
19 Dr Motor vehicles 10,000 Syarikat LN
Cr Other payables: Min Motor 10,000
Acquired motor vehicles on credit term. Other Payables: Syarikat LN Account
Apr RM
24 Dr Other receivables: Chop Soon Lee 9,000 9 Stationery 144
Cr Disposal of furniture 9,000
Office furniture sold on credit term.
29 Dr Promotions (RM50 x 3) 150 Drawings Account
Cr Purchases 150 Apr RM
Inventories distributed as free samples. 11 Purchases 50
30 Insurance 200
30 Dr Donation 73
Cr Purchases 73
Inventories donated to orphanage.
Purchases Account
30 Dr Drawings (RM800 ÷ 4) 200 Apr RM
Cr Insurance 200 11 Drawings 50
A quarter of insurance is for personal use. 29 Promotions 150
30 Donation 73
ABFA1153 FINANCIAL ACCOUNTING I 7

Section 4: Extra exercise question

Motor Vehicles Account
Apr RM Question 1
Other Payables: Min
19 10,000 Petty Cash Book
Motor Date Particulars Voucher Receipt Payment Analysis
Office Motor Cleaning
Nov   No Dr Cr Exp Exp Exp Wages
Other Payables: Min Motor Account
Apr RM 1 Cash 1,000.00
19 Motor Vehicles 10,000 1 Siti - wages 1 10.00 10.00

1 Envelopes 2 4.80 4.80

Disposal of Furniture Account 2 Cleaning liq 3 4.20 4.20

Apr RM 2
Adhesive
tapes 4 6.80 6.80
Other Payables:
24 9,000 3 Paper clips 5 1.40 1.40
Chop Soon Lee Petrol WAY
4 44 6 5.00 5.00
May -
Other Receivables: Chop Soon Lee Account 5 Wages 7 10.00 10.00
Apr RM 6
Nathan -
Wages 8 10.00 10.00
Disposal of A4 copy
24 9,000 7 papers 9 14.30 14.30
Furniture
7 Pens 10 7.20 7.20
Promotions Account Andy -
8 wages 11 22.00 22.00
Apr RM
29 Purchases 150 9 Change oil 12 12.00 12.00

10 Motor tax 13 8.00 8.00

Donation Account 11 Tip-ex

White
14 2.20 2.20

Apr RM 12 coffee 15 13.90 13.90

A3 copy
30 Purchases 73 13 papers 16 10.70 10.70
Cleaning
14 exp 17 14.35 14.35

Insurance Account 15 Wipers 18 28.90 28.90

Apr RM 16 Tim- wages 19 15.00 15.00

Sakdon -
30 Drawings 200 16 wages 20 15.00 15.00
Carbon
18 papers 21 5.40 5.40
Cardboard
20 files 22 3.60 3.60
ABFA1153 FINANCIAL ACCOUNTING I 8

Rubber
21 bands 23 11.20 11.20 25 Postage 7 6 6
Petrol
22 BAB12 24 5.00 5.00 28 Travelling 8 8 8

Cleaning  
23 exp 25 24.60 24.60
Printer 178 42 80 32 24
24 ribbon 26 26.60 26.60
30 Balance c/d 22
25 Taxi fare 27 12.20 12.20
200 200
26 Copy repair 28 34.40 34.40 May-
01 Balance b/d 22
27 Postage 29 11.50 11.50
Off boy Cash 178
27 service 30 7.70 7.70
Petrol WAY
27 44 31 10.00 10.00 Question 3:
367.95 173.90 68.90 43.15 82.00
General Journal
Date Particular DR (RM) CR (RM)
30 Balance c/d 632.05
May 1 Cash 150,000
1,000.00 1,000.00 Capital 150,000
Dec1 Balance b/d 632.05 (Capital contribution )
Cash 367.95
‘’ 5 Computer/Office Equipment 3,000
1,000.00
Capital 3,000

‘’ 13 Drawing 50
Question 2
Purchases 50

Petty Cash Book

‘’ 17 Office Equipment 5,500
Date Particulars Voucher Receipt Payment Analysis Other Payable- Dr Café 5,500
Travel
April   No Dr Cr Stationery Cleaning Exp Postage Outlet
1 Balance b/d 28

Cash 172
‘’ 20 Promotion expenses 500
Purchases 500
6 Stationery 1 14 14

12 Travelling 2 24 24
‘’ 25 Drawings(2800/2) 1,400
14 Cleaner's Wages 3 40 40 Office Rental 1,400
16 Postage 4 18 18

18 Typing papers 5 28 28 ‘’30 Furniture 8,900

21 Cleaner's Wages 6 40 40 Other Payable- Lozenzo 8,900
ABFA1153 FINANCIAL ACCOUNTING I 9