WAEC SSCE - Financial Accounting - 2006 (Objective)

Question 1 Report

A system where a separate cash book is maintained for small payments is

single entry

imprest

float

reimbursement

Answer Details

The system where a separate cash book is maintained for small payments is known as the imprest system. In the imprest system, a fixed amount of money is set aside in advance for making small payments, and a separate cash book is maintained to record these transactions. This system is commonly used by businesses and organizations to manage petty cash expenses, such as office supplies or travel expenses. Under the imprest system, the petty cash fund is replenished periodically, based on the amount of money that has been spent on small expenses. This ensures that there is always a fixed amount of money available for making small payments, and helps to prevent misuse or misappropriation of funds. Overall, the imprest system provides a simple and effective way for organizations to manage their petty cash expenses, while maintaining proper accounting and control over these funds.

Read lesson note on Incomplete Records And Single Entry (JAMB)






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