Question

2. When a petty cash book is kept there will be
A) No entries made at all in the general ledger for items paid by petty cash
B) The same number of entries in the general ledger
C) Fewer entries made in the general ledger
D) More entries made in the general ledger​

Answer 1

Answer:

Explanation:

Fewer entries made in the general ledger.

Answer 2

Answer:

B) The same number of entries in the general ledger.

Explanation:

• A Petty Cash Book is used for recording payment of petty expenses, which are of smaller value.

• These may include postage, stationery, conveyance, refreshment, etc.
• A person who maintains a petty cash book is known as a petty cashier and the small expenses are called petty expenses.

When a petty cash book is kept there will be the same number of entries in the general ledger.

• According to the rules of accounting, every transaction (expense or gain) must be recorded.

• Therefore, every transaction in the petty cash book (of debit or credit) will have a respective entry in the general ledger of debit or credit balance.