Journal Entry for Drew Cheque for Petty Cash

There are two accounts that are affected when a cheque is drawn for petty cash:

1. Petty Cash Account: it is credited as cash is being withdrawn from the account.
2. Bank Account: it is debited as the cheque is being drawn from the account.

Step-by-step process:

1. Determine the amount of the cheque that is being drawn for petty cash.
2. Debit the bank account by the amount of the cheque.
3. Credit the petty cash account by the same amount.
4. Record the transaction in the general ledger.

The journal entry for drawing a cheque for petty cash is as follows:

Bank Account Debit - The bank account is debited as it is being reduced by the amount of the cheque.

Petty Cash Account Credit - The petty cash account is credited as cash is being withdrawn from the account.

The journal entry is recorded as follows:

Bank Account Debit | Amount of the Cheque
Petty Cash Account Credit | Same Amount as the Cheque

Example:

Suppose a cheque for $100 is drawn for petty cash, the journal entry would be:

Bank Account Debit | $100
Petty Cash Account Credit | $100

In conclusion, the journal entry for drawing a cheque for petty cash involves debiting the bank account and crediting the petty cash account. This transaction is recorded in the general ledger as a reduction in the bank account and an increase in the petty cash account.

Petty expenses ac Dr
to bank ac