Journal Entry for Petty Cash Reimbursement
When a petty cash fund is reimbursed, it means replenishing the petty cash account to maintain a set amount of cash on hand. This involves recording the expenses that were paid out of the petty cash and then replenishing the petty cash with the same amount.
Here's how to record the petty cash reimbursement:
1. Recording Petty Cash Expenses
Before reimbursing the petty cash, record the expenses paid from the petty cash fund.
| Date | Particulars | Debit (₹) | Credit (₹) |
|---|---|---|---|
| 2024-06-07 | Postage Expense A/c | 1,000 | |
| Stationery Expense A/c | 2,000 | ||
| Miscellaneous Expense A/c | 500 | ||
| To Petty Cash A/c | 3,500 | ||
| (Being various expenses paid from petty cash) |
2. Reimbursing Petty Cash
After recording the expenses, replenish the petty cash fund to its original amount.
| Date | Particulars | Debit (₹) | Credit (₹) |
|---|---|---|---|
| 2024-06-07 | Petty Cash A/c | 3,500 | |
| To Cash/Bank A/c | 3,500 | ||
| (Being reimbursement of petty cash) |
Explanation:
Recording Petty Cash Expenses:
- Postage Expense A/c, Stationery Expense A/c, and Miscellaneous Expense A/c are debited to reflect the incurred expenses.
- Petty Cash A/c is credited to decrease the petty cash fund by the amount of expenses paid out.
Reimbursing Petty Cash:
- Petty Cash A/c is debited to increase the petty cash fund back to its original amount.
- Cash/Bank A/c is credited to reflect the cash outflow from the main cash or bank account.
