What is petty cash?

[rajivkumar]

I’m new to accounting and wanted to ask—what is petty cash exactly? From what I’ve read, it’s a small fund that businesses keep on hand to cover minor expenses like office supplies, small repairs, or quick reimbursements. How do companies usually manage petty cash—do they just keep receipts in a box or is there a formal record-keeping process? I’d love to hear how others handle it in their workplace.

 

[isabel]

Petty cash is a limited sum of money kept available to a company to pay for minor or everyday expenses such as office supplies, postage, and refreshments instead of writing checks or getting a bank transfer.

 

[danisjohn]

Petty cash is a small sum of money in reserve that has to be used to pay on small, daily business needs like supplies in the office, postage, or snacks. A custodian normally manages it and an entry is made in a petty cash log. This system enables easy fast payments without writing checks or card payment.

 

[Gsusangrey]

Petty cash is a small amount of physical money kept on hand by businesses for minor, everyday expenses like office supplies, postage, or staff reimbursements. It simplifies handling small payments without issuing checks or using corporate accounts.

 

[brook]

Petty cash is a small fixed amount that the office keeps for daily small expenses like stationery, snacks or minor purchases. It is recorded in the accounting system and is used for simple transactions.