Petty cash system: Petty cash system is a management of small cash transactions where payment of petty expenses is made out of it. It contains fixed balance which is maintained on monthly basis by the cashier. Journal entries : It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health Rules to pass journal entries: Debit what comes in credit what goes out. Debit all income, gains and credit all expenses, losses. Debit the receiver and credit the giver. To prepare: Journal entries of P Company to (1) Establish the fund on January 1 (2) Reimburse it on January 8 (3) Both reimburse the fund and increase it to $450 on January 8.

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Answer 1

Question

Chapter 6, Problem 6E

To determine

Petty cash system: Petty cash system is a management of small cash transactions where payment of petty expenses is made out of it. It contains fixed balance which is maintained on monthly basis by the cashier.

Journal entries: It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health

Rules to pass journal entries:

Debit what comes in credit what goes out.

Debit all income, gains and credit all expenses, losses.

Debit the receiver and credit the giver.

To prepare: Journal entries of P Company to (1) Establish the fund on January 1 (2) Reimburse it on January 8 (3) Both reimburse the fund and increase it to $450 on January 8.

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Answer 2

Question

Chapter 6, Problem 6E

To determine

Petty cash system: Petty cash system is a management of small cash transactions where payment of petty expenses is made out of it. It contains fixed balance which is maintained on monthly basis by the cashier.

Journal entries: It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health

Rules to pass journal entries:

Debit what comes in credit what goes out.

Debit all income, gains and credit all expenses, losses.

Debit the receiver and credit the giver.

To prepare: Journal entries of P Company to (1) Establish the fund on January 1 (2) Reimburse it on January 8 (3) Both reimburse the fund and increase it to $450 on January 8.

Expert Solution & Answer

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Answer 3

Question

Chapter 6, Problem 6E

To determine

Petty cash system: Petty cash system is a management of small cash transactions where payment of petty expenses is made out of it. It contains fixed balance which is maintained on monthly basis by the cashier.

Journal entries: It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health

Rules to pass journal entries:

Debit what comes in credit what goes out.

Debit all income, gains and credit all expenses, losses.

Debit the receiver and credit the giver.

To prepare: Journal entries of P Company to (1) Establish the fund on January 1 (2) Reimburse it on January 8 (3) Both reimburse the fund and increase it to $450 on January 8.

Expert Solution & Answer

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Answer 4

Question

Chapter 6, Problem 6E

To determine

Petty cash system: Petty cash system is a management of small cash transactions where payment of petty expenses is made out of it. It contains fixed balance which is maintained on monthly basis by the cashier.

Journal entries: It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health

Rules to pass journal entries:

Debit what comes in credit what goes out.

Debit all income, gains and credit all expenses, losses.

Debit the receiver and credit the giver.

To prepare: Journal entries of P Company to (1) Establish the fund on January 1 (2) Reimburse it on January 8 (3) Both reimburse the fund and increase it to $450 on January 8.

Expert Solution & Answer

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Answer 5

Chapter 6, Problem 6E

To determine

Petty cash system: Petty cash system is a management of small cash transactions where payment of petty expenses is made out of it. It contains fixed balance which is maintained on monthly basis by the cashier.

Journal entries: It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health

Rules to pass journal entries:

Debit what comes in credit what goes out.

Debit all income, gains and credit all expenses, losses.

Debit the receiver and credit the giver.

To prepare: Journal entries of P Company to (1) Establish the fund on January 1 (2) Reimburse it on January 8 (3) Both reimburse the fund and increase it to $450 on January 8.

Answer 6

Chapter 6, Problem 6E

To determine

Petty cash system: Petty cash system is a management of small cash transactions where payment of petty expenses is made out of it. It contains fixed balance which is maintained on monthly basis by the cashier.

Journal entries: It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health

Rules to pass journal entries:

Debit what comes in credit what goes out.

Debit all income, gains and credit all expenses, losses.

Debit the receiver and credit the giver.

To prepare: Journal entries of P Company to (1) Establish the fund on January 1 (2) Reimburse it on January 8 (3) Both reimburse the fund and increase it to $450 on January 8.

Answer 7

Chapter 6, Problem 6E

To determine

Petty cash system: Petty cash system is a management of small cash transactions where payment of petty expenses is made out of it. It contains fixed balance which is maintained on monthly basis by the cashier.

Journal entries: It means record of financial data related to business transactions in a journal in a manner so that debit equals credit. It provides an audit trail to the auditor and a means to analyze the effects of transactions to an organization’s financial health

Rules to pass journal entries:

Debit what comes in credit what goes out.

Debit all income, gains and credit all expenses, losses.

Debit the receiver and credit the giver.

To prepare: Journal entries of P Company to (1) Establish the fund on January 1 (2) Reimburse it on January 8 (3) Both reimburse the fund and increase it to $450 on January 8.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 6 - Prob. 1MCQ Ch. 6 - Prob. 2MCQ Ch. 6 - Prob. 3MCQ Ch. 6 - Prob. 4MCQ Ch. 6 - Prob. 1DQ Ch. 6 - Prob. 2DQ Ch. 6 - Prob. 3DQ Ch. 6 - Prob. 4DQ Ch. 6 - Prob. 5DQ Ch. 6 - Prob. 6DQ

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Chapter 6 Solutions