Mercury Company established a petty cash fund with a​ $400 balance. Which of the following statements is​ incorrect?         A. The sum of the cash plus the total of the petty cash tickets should equal​ $400 at all times.   B. The petty cash custodian cashes a check for​ $400 and places the currency in the petty cash fund box.   C. There is no net effect on current assets.   D. A journal entry is needed to debit the Cash account and credit the Petty Cash account for​ $400.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Mercury Company established a petty cash fund with a​ $400 balance. Which of the following statements is​ incorrect?
 
 
 
 
A.
The sum of the cash plus the total of the petty cash tickets should equal​ $400 at all times.
 
B.
The petty cash custodian cashes a check for​ $400 and places the currency in the petty cash fund box.
 
C.
There is no net effect on current assets.
 
D.
A journal entry is needed to debit the Cash account and credit the Petty Cash account for​ $400.
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