The purpose of maintaining a petty cash fund is:

Multiple Choice

• Replaces a bank savings account which can be subject to high bank charges.
• None of the other alternatives are correct
• Purchases to be made when the purchaser does not want his/her manager to know and he/she does not need the manager to sign a cheque if he/she uses petty cash.
• Emergency funds in case of capital asset purchase.
• Emergency funds in case cash flow statement reflects a net cash outflow.