Question

The closing balance of the petty cash book is_______.

• A. Expense/expenditure
• B. Profit/ gain
• C. Assets
• D. Liability

Answer 1

Answer: (C)

Assets

The closing balance of petty cash book is considered as Asset.

Petty Cash is a current asset account; it is part of a company's cash.

Petty cash Book is just like a cash book , its just that this book maintains petty cash expenses separately as against the normal cash book .

Therefore, balance of petty cash book is an asset & an not income. Its used for paying out petty expenses.