Accounting Basics

What Is Petty Cash?

A small fund of cash kept on hand for minor, everyday business expenses.

Detailed Explanation

Petty cash covers expenses too small to process through normal AP, such as office supplies or postage. Receipts must be retained and the fund reconciled regularly.

Example

The office manager uses petty cash to buy $15 in stamps and logs the receipt in the petty cash ledger.

Why It Matters

Proper petty cash controls prevent small expenses from becoming untraceable leaks.

Related Resources

Business expense tracking
Invoice record keeping

Related Accounting Basics Terms

Billing Cycle Cost Center Float Operating Expense Reconciliation Revenue Recognition

Get invoicing tips that actually help

Join 5,000+ freelancers and small business owners. One email per week with practical invoicing advice, tax tips, and product updates.

No spam, ever. Unsubscribe anytime.