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The balance in the petty cash book is
- a)An expense
- b)A Profit
- c)An asset.
- d)A liability
Correct answer is option 'C'. Can you explain this answer?
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Most Upvoted Answer
The balance in the petty cash book isa)An expenseb)A Profitc)An asset....
Explanation:
Petty cash is a small amount of cash that is kept on hand by a business to pay for small expenses like postage, office supplies, or other miscellaneous expenses. The balance in the petty cash book is an asset because it represents the amount of cash that the business has on hand.
Assets: Assets are resources that a company owns that have value and can be used to generate revenue. They include cash, accounts receivable, inventory, property, plant, and equipment.
Liabilities: Liabilities are obligations that a company owes to others. They include accounts payable, loans payable, and other debts.
Expenses: Expenses are costs that a company incurs in order to generate revenue. They include salaries and wages, rent, utilities, and other costs.
Profit: Profit is the difference between revenue and expenses. If revenue is greater than expenses, the company has a profit. If expenses are greater than revenue, the company has a loss.
In summary, the balance in the petty cash book is an asset because it represents the amount of cash that the business has on hand.
Petty cash is a small amount of cash that is kept on hand by a business to pay for small expenses like postage, office supplies, or other miscellaneous expenses. The balance in the petty cash book is an asset because it represents the amount of cash that the business has on hand.
Assets: Assets are resources that a company owns that have value and can be used to generate revenue. They include cash, accounts receivable, inventory, property, plant, and equipment.
Liabilities: Liabilities are obligations that a company owes to others. They include accounts payable, loans payable, and other debts.
Expenses: Expenses are costs that a company incurs in order to generate revenue. They include salaries and wages, rent, utilities, and other costs.
Profit: Profit is the difference between revenue and expenses. If revenue is greater than expenses, the company has a profit. If expenses are greater than revenue, the company has a loss.
In summary, the balance in the petty cash book is an asset because it represents the amount of cash that the business has on hand.
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Community Answer
The balance in the petty cash book isa)An expenseb)A Profitc)An asset....
Petty cash book is used to record the day to day small value transactions. Balance lying in petty cash book is as good as cash balance. Cash is an asset for the business.
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The balance in the petty cash book isa)An expenseb)A Profitc)An asset.d)A liabilityCorrect answer is option 'C'. Can you explain this answer?
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