Superior Cabinets maintains a petty cash fund for minor business expenditures. The petty cashcustodian, Mo Smith, describes the events that occurred during the last two months:a. I established the fund by cashing a Superior Cabinets’ check for $300 made payable to me.b. Liz Clay provided a receipt for $50 for various supplies. I paid $50 cash to her.c. James Flyer provided a $70 taxi receipt, so I paid $70 cash to him.d. Ricky Ricota claimed to do photocopying for Superior Cabinets at The UPS Store for $97 buthad misplaced the receipt. I took him at his word and paid $97 cash to him.e. On the last day of the month, I prepared a summary of expenditures and requested the fund bereplenished. I received and cashed a Superior Cabinets’ check for $217, placing the cash intothe locked cash box.f. James Flyer provided receipts for taxi costs ($75), so I paid $75 cash to him.g. Woo Riun provided a $147 receipt from a local delivery company for an expedited delivery toa customer. I paid her $147 cash.h. Ricky Ricota claimed to have purchased $35 of envelopes, but again he had misplaced thereceipt. He showed me a big stack of envelopes, so I paid him $35 cash.i. After requesting that the fund be replenished, I received and cashed a Superior Cabinets’check for $257, placing the cash into the locked cash box.j. After suggesting that the petty cash fund be increased, I received and cashed a Superior Cabinets’ check for $100 cash, which I placed in the locked cash box.Required:1. Prepare journal entries where required.TIP: Remember that petty cash journal entries are recorded only when the fund is establishedand reimbursed, not when each payment is made.2. If Superior Cabinets has $1,000 cash in the bank, $500 of government Treasury bills purchased last month with a six-week maturity, and $750 of cash set aside for legal reasons, howmuch will the company report on the balance sheet as “Cash and Cash Equivalents”?
Superior Cabinets maintains a petty cash fund for minor business expenditures. The petty cash
custodian, Mo Smith, describes the events that occurred during the last two months:
a. I established the fund by cashing a Superior Cabinets’ check for $300 made payable to me.
b. Liz Clay provided a receipt for $50 for various supplies. I paid $50 cash to her.
c. James Flyer provided a $70 taxi receipt, so I paid $70 cash to him.
d. Ricky Ricota claimed to do photocopying for Superior Cabinets at The UPS Store for $97 but
had misplaced the receipt. I took him at his word and paid $97 cash to him.
e. On the last day of the month, I prepared a summary of expenditures and requested the fund be
replenished. I received and cashed a Superior Cabinets’ check for $217, placing the cash into
the locked cash box.
f. James Flyer provided receipts for taxi costs ($75), so I paid $75 cash to him.
g. Woo Riun provided a $147 receipt from a local delivery company for an expedited delivery to
a customer. I paid her $147 cash.
h. Ricky Ricota claimed to have purchased $35 of envelopes, but again he had misplaced the
receipt. He showed me a big stack of envelopes, so I paid him $35 cash.
i. After requesting that the fund be replenished, I received and cashed a Superior Cabinets’
check for $257, placing the cash into the locked cash box.
j. After suggesting that the petty cash fund be increased, I received and cashed a Superior Cabinets’ check for $100 cash, which I placed in the locked cash box.
Required:
1. Prepare
TIP: Remember that petty cash journal entries are recorded only when the fund is established
and reimbursed, not when each payment is made.
2. If Superior Cabinets has $1,000 cash in the bank, $500 of government Treasury bills purchased last month with a six-week maturity, and $750 of cash set aside for legal reasons, how
much will the company report on the
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