Do you have a small amount of cash in your office or at stores then, it is much easier for bookkeepers, supervisors, and office managers to cover occasional small purchases of expenses in Petty Cash QuickBooks.
Petty cash is a small number of funds for small expenses. Most people use this cash for buying things like buying office supplies, small repairs, paying for postage, and so on. Petty cash is the common type of financial account system and it is a predesignated amount that is built into the budget and replenished after a set period of time or when it runs out. But is difficult to keep a record on a daily basis of expenses.
What is Petty Cash?
A convenient supply of cash that can be used to make payments instant for goods and services is known as petty cash. To check and control the petty cash box you should designate one person at your company and keep track of each and every withdrawal.
Some uses of petty cash-:
- Snacks or foods for a special occasion
- Make the change for customers if the primary source of change is low.
This petty cash is one of the best features of QuickBooks online. If you have a new user in QuickBooks and don’t understand how to set up this fund then we are going to explain here.
Let Us Know How to Properly Set Up Petty Cash Account in QuickBooks
Step 1. Don’t need to use sales to finance your expenses as this will make your control over your debtors more complicated.
Step 2. You have to make a new Petty Cash Account in QuickBooks and type of account should be a bank.
Step 3. Then you need to Drawn a cheque of Rs 5,000 or any other amount depending on the limit of your transactions and business activity. The service company will need less cash, such as a construction company, where petty items might be required to be purchased for ongoing contracts.
Step 4. You have to keep your all petty cash bills and vouchers together and make the total on a weekly or monthly basis.
Step 5. Write a cheque in QuickBooks for all your expenses which are analyzed to their respective accounts. This is the process of the way that QuickBooks will Debit your expenses account and will Credit your Petty Cash Account.
Step 6. If you have many bills of transactions that are on an excel sheet then, post the total following step 5.
Step 7. You can pay your Petty Cash by issuing a new cheque for the total amount which arrived as per Step 3 above.
Step 8. And you need to check your Petty Cash balance daily, weekly or monthly basis and compare your Petty Cash balance as per QuickBooks with your cash count.
You don’t need to use sales takings to finance your cash expenses. Receive payments and make deposits of all receipts from clients in your QuickBooks.
You should Always remember the following method for the best business practices to set proper control over cash transactions.
- When your staff will request you for a petty cash replenishment, then you need to make sure all bills and vouchers are originals. Don’t accept copies.
- Total summaries of bills/vouchers presented to cross-check arithmetical accuracy.
- You should make a surprise cash count from time to time.
- Sign and approve all Petty Cash requests.
- Consider paying by cheque, expenses which are recurrent and material.
Set Up Petty Cash QuickBooks through Online
Petty cash is a convenient supply of coins that you could use to pay small expenses. Here are some guidelines on a way to manipulate petty cash, and how to track it in QuickBooks Online.
Here we have mentioned some steps to set up a petty cash account.
- Go to the setting and select the chart of accounts.
- Then select new.
- From the account, type drop-down, select Bank.
- From the detail type drop-down and select cash on hand.
- Here you need to enter the petty cash for the account name.
- When you passed from the cash checking account by using writing then take a look at moving funds. If already you have received cash for the use of petty cash.
How to Use Petty Cash in QuickBooks
When the account properly set up. Then, you can use a petty case but It’s time to put some money into it. Select the Petty Cash as the cash payee. Here a way to get commenced and hold up with the entirety you do in petty cash.
Debit some cash out of your account and position it in a locked coin box.
- Give the history of transactions in Quickbooks Online.
- If you wrote a take a look at for cash then choose to Create and Check.
- You have to choose the Petty Cash because of the payee.
- If you took out the cash without a take a look at choosing to Create and then Trans
- If you took out the coins without a check: select Create and then Transfer.
When you have given cash to an employee or use the cash amount yourself then, keep the record safe and find out who, when, and what money was used. It is a receipt type to track the case you have withdrawn In QuickBooks, there is a record of the cash from Petty cash as an expense, with Petty cash as the payment account. All times, the amount of paper you have left and the amount of cash you have drawn should be added to the amount deposited in the box.