Corporate Financial Accounting
Corporate Financial Accounting
15th Edition
ISBN: 9781337670517
Author: WARREN
Publisher: Cengage
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Chapter 7, Problem 7.4BE

(a)

To determine

Petty cash fund: Petty cash fund is a fund established to pay insignificant amounts like postage, office supplies, and lunches. In day-to-day life, it becomes difficult to use checks for daily expenses.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

  • Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.
  • Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The issue of check for petty cash fund establishment

(b)

To determine

To journalize: The replenishment of petty cash fund

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Chapter 7 Solutions

Corporate Financial Accounting

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