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EcoMart establishes a $1,050 petty cash fund on May 2. On May 30, the fund shows $326 in cash along with receipts for the following expenditures: transportation-in, $120; postage expenses, $369; and miscellaneous expenses, $240. The company uses the perpetual system in accounting for merchandise inventory. What is the journal entry to record the establishment of the fund on May 2?   A. Debit Petty Cash $1,050; credit Cash $1,050   B. Debit Miscellaneous Expense $1,050; credit Cash $1,050   C. Debit Cash $1,050; credit Accounts Payable $1,050   D. Debit Petty Cash $1,050; credit Accounts Payable $1,050

EcoMart establishes a $1,050 petty cash fund on May 2. On May 30, the fund shows $326 in cash along with receipts for the following expenditures: transportation-in, $120; postage expenses, $369; and miscellaneous expenses, $240. The company uses the perpetual system in accounting for merchandise inventory. What is the journal entry to record the establishment of the fund on May 2?   A. Debit Petty Cash $1,050; credit Cash $1,050   B. Debit Miscellaneous Expense $1,050; credit Cash $1,050   C. Debit Cash $1,050; credit Accounts Payable $1,050   D. Debit Petty Cash $1,050; credit Accounts Payable $1,050

FINANCIAL ACCOUNTING
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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EcoMart establishes a $1,050 petty cash fund on May 2. On May 30, the fund shows $326 in cash along with receipts for the following expenditures: transportation-in, $120; postage expenses, $369; and miscellaneous expenses, $240. The company uses the perpetual system in accounting for merchandise inventory.

What is the journal entry to record the establishment of the fund on May 2?

  A.

Debit Petty Cash $1,050; credit Cash $1,050
  B.

Debit Miscellaneous Expense $1,050; credit Cash $1,050
  C.

Debit Cash $1,050; credit Accounts Payable $1,050
  D.

Debit Petty Cash $1,050; credit Accounts Payable $1,050
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