What is the difference between cash in hand and petty cash?

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Solution

Petty cash is the money that is available for making small purchases and payments such as stationary, postal expenses, courier charges, etc. Petty cash is used instead of making payments from credit cards and cheques.

Cash in hand is the accessible money that is utilised to make payments for goods and services to avoid taxes on the earned income.

Also see:

MCQs on Journal Entries

Types of Cash Book

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