Petty cash definition including break down of areas in the definition. Analyzing the definition of key term often provides more insight about concepts. Petty cash can be defined as: Small amount of cash in a fund to pay minor expenses; accounted for using an imprest system. Petty cash is the small amount of cash that can be useful to have in order to pay minor expenses. A business can decide how much to have in petty cash, too much petty cash being a risk, too little petty cash not being sufficient to cover expenses. Once the dollar amount of petty cash is determined cash can be removed from the checking account and put into petty cash. The patty cash will be tracked using receipts and notes for payments. The petty can will then be counted periodically an replenished to the set amount, recorded related expenses based on receipts and notes at this time.
