What is the type of account and normal balance of petty cash book?

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Type of Account

“Petty cash” is an asset and is shown under the category of current assets in the balance sheet. Since it is an asset, the normal balance of petty cash will show a positive balance (or) debit balance. According to the modern rules whenever there is an increase in the value of the asset then the particular asset account is being debited and vice-versa.

Modern Accounting Approach

Received 250 from the head cashier for all petty cash expenses. Journalise the following transaction.


Accounts Involved L.F. Amount Nature of Account Accounting Rule
Petty cash a/c 250 Asset Debit– The Increase in Asset
 Cash a/c  250 Asset Credit– The Decrease in Asset

The amount of petty cash will increase when it is debited with additional cash and will decrease when expenses are incurred. Petty-cash book follows the imprest system of accounting. The normal opening balance of cash will be placed on the Left-Hand Side under the cash receipts column. Total payments are shown on the Right Hand Side of the petty cash book.



Prepare a Petty Cash Book on the imprest system from the following data as provided below-

Date Particulars Amount
Jan        1 Received cash from head cashier 450
              2 Paid cartage 20
              3 Paid for carriage 50
              4 Paid for bus fare 50
              5 Cartage charges 40
              6 Refreshments to customers 40


Petty Cash Book

Petty Cash Book



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