A company established a petty cash fund in April of the current year and experienced the following transactions affecting the fund during April. Prepare journal entries to establish the fund on April 1, to replenish it on April 25, and to record the increase in the fund on April 25. April 1Prepared a company check for $300.00 to establish the petty cash fund.April 25Prepared a company check to replenish the fund for the following expenditures made since April 1. Paid $84.50 for cleaning services. Paid $84.00 for postage expense. Paid $103.15 for office supplies. Counted $23.35 remaining in the petty cash box.April 25The company decides to increase the fund by $100.

A petty cash fund's main objective is to give business units enough money to pay for small expenses. The purpose is to make it easier for staff workers and visitors to get reimbursed for little expenses like taxi rides, postage, office supplies, and other things that often don't cost more than $25.00. PART-1 Apr-01 Petty cash 300 Cash 300 Apr-25 Miscellaneous expense 84.50 Postage expenses 84.00 Office supplies expense 103.15 Cash over and short 5.00 Cash 276.65 Apr-25 Petty cash 100 Cash 100

Answered: A company established a petty cash fund…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A company established a petty cash fund in April of the current year and experienced the following transactions affecting the fund during April. Prepare journal entries to establish the fund on April 1, to replenish it on April 25, and to record the increase in the fund on April 25.

April 1	Prepared a company check for $300.00 to establish the petty cash fund.
April 25	Prepared a company check to replenish the fund for the following expenditures made since April 1.
	Paid $84.50 for cleaning services.
	Paid $84.00 for postage expense.
	Paid $103.15 for office supplies.
	Counted $23.35 remaining in the petty cash box.
April 25	The company decides to increase the fund by $100.

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