Bounded sound beam propagation in an inhomogeneous medium is treated by the nonsingular perturbation method. For a liquid with gas bubbles the analogue of the Khokhlov-Zabolotskaya equation with KdV dispersion term was derived. An equation with new coefficients which are revised for a compressible liquid is obtained. It is essential for the dynamics of a bubbly liquid with a small volume concentration of bubbles. Some explicit solutions that come from a connection of the resulting equation with the cylindrical Kadomtsev-Petviashvilli (Johnson) equation are discussed. ©2000 American Institute of Physics.