Financial Accounting
15th Edition
ISBN: 9781337272124
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Chapter 8, Problem 24E
(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. Therefore, companies maintain some minimum amount of funds in the hand for such daily expenses. These funds are called as petty cash funds. These funds are managed by custodian. This system is otherwise called as imprest system.
To prepare: A
(b)
To determine
To prepare: Journal entry to record petty cash fund replenishment.
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Journalize the entries to record the following:
Check is issued to establish a petty cash fund of $1,500.
The amount of cash in the petty cash fund is now $540. Check is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $557; miscellaneous selling expense, $230; miscellaneous administrative expense, $144. (Because the amount of the check to replenish the fund plus the balance in the fund do not equal $1,500, record the discrepancy in the cash short and over account.)
a. Journalize the entry to establish the petty cash fund.
b. Journalize the entry to replenish the petty cash fund. For a compound transaction, if an amount box does not require an entry, leave it blank.
Journalize the entries to record the following:
Required:
a.
On March 1, check is issued to establish a petty cash fund of $1,035.*
b.
On April 1, The amount of cash in the petty cash fund is now $100. Check is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $529; miscellaneous selling expense, $210; miscellaneous administrative expense, $163. If the amount of the check to replenish the fund plus the balance in the fund do not equal $1,035, record the discrepancy in the cash short and over account.*
*Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
Journalize the entries to record the following:
Required:
a.
On March 1, check is issued to establish a petty cash fund of $1,290.*
b.
On April 1, The amount of cash in the petty cash fund is now $303. Check is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $427; miscellaneous selling expense, $365; miscellaneous administrative expense, $165. If the amount of the check to replenish the fund plus the balance in the fund do not equal $1,290, record the discrepancy in the cash short and over account.*
*Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
Chart of Accounts
CHART OF ACCOUNTS
General Ledger
ASSETS
110
Cash
111
Petty Cash
120…
Chapter 8 Solutions
Financial Accounting
Ch. 8 - Prob. 1DQCh. 8 - Why should the employee who handles cash receipts...Ch. 8 - Prob. 3DQCh. 8 - Why should the responsibility for maintaining the...Ch. 8 - Assume that Brooke Miles, accounts payable clerk...Ch. 8 - Prob. 6DQCh. 8 - Prob. 7DQCh. 8 - Prob. 8DQCh. 8 - Prob. 9DQCh. 8 - Prob. 10DQ
Ch. 8 - Prob. 1PEACh. 8 - Prob. 1PEBCh. 8 - Prob. 2PEACh. 8 - Prob. 2PEBCh. 8 - Prob. 3PEACh. 8 - Prob. 3PEBCh. 8 - Prob. 4PEACh. 8 - Prob. 4PEBCh. 8 - Financial data for Otto Company follow: a....Ch. 8 - Prob. 5PEBCh. 8 - Prob. 1ECh. 8 - Prob. 2ECh. 8 - Prob. 3ECh. 8 - Pacific Bank provides loans to businesses in the...Ch. 8 - Prob. 5ECh. 8 - An employee of JHT Holdings, Inc., a trucking...Ch. 8 - Prob. 7ECh. 8 - Prob. 8ECh. 8 - Prob. 9ECh. 8 - Prob. 10ECh. 8 - Prob. 11ECh. 8 - The actual cash received from cash sales was...Ch. 8 - The actual cash received from cash sales was...Ch. 8 - Abbe Co. is a small merchandising company with a...Ch. 8 - Prob. 15ECh. 8 - Prob. 16ECh. 8 - Prob. 17ECh. 8 - Prob. 18ECh. 8 - Prob. 19ECh. 8 - Prob. 20ECh. 8 - Prob. 21ECh. 8 - Prob. 22ECh. 8 - Prob. 23ECh. 8 - Prob. 24ECh. 8 - Mattel, Inc., designs, manufactures, and markets...Ch. 8 - El Dorado Inc. has monthly cash expenses of...Ch. 8 - Prob. 27ECh. 8 - Amicus Therapeutics, Inc., is a biopharmaceutical...Ch. 8 - Prob. 1PACh. 8 - Prob. 2PACh. 8 - Prob. 3PACh. 8 - Prob. 4PACh. 8 - Prob. 5PACh. 8 - Prob. 1PBCh. 8 - Prob. 2PBCh. 8 - Prob. 3PBCh. 8 - Prob. 4PBCh. 8 - Prob. 5PBCh. 8 - Tehra Dactyl is an accountant for Skeds, Inc., a...Ch. 8 - During the preparation of the bank reconciliation...Ch. 8 - Prob. 5CPCh. 8 - Prob. 6CPCh. 8 - Prob. 7CPCh. 8 - Prob. 8CPCh. 8 - Prob. 9CP
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- On September 1, French company has decided to initiate a petty cash fund in the amount of $800. Prepare journal entries for the following transactions: A. On September 5, the petty cash fund needed replenishment, and the following are the receipts: Auto Expense $37, Supplies $124, Postage Expense $270, Repairs and Maintenance Expense $168, Miscellaneous Expense $149. The cash on hand at this time was $48. B. On September 14, the petty cash fund needed replenishment and the following are the receipts: Auto Expense $18, Supplies $175, Postage Expense $50, Repairs and Maintenance Expense $269, Miscellaneous Expense $59. The cash on hand at this time was $210. C. On September 23, the petty cash fund needed replenishment and the following are the receipts: Auto Expense $251, Supplies $88, Postage Expense $63, Repairs and Maintenance Expense $182, Miscellaneous Expense $203. The cash on hand at this time was $20. D. On September 29, the company determined that the petty cash fund needed to be increased to $1,000. E. On September 30, the petty cash fund needed replenishment as it was month end. The following are the receipts: Auto Expense $18, Supplies $15, Postage Expense $57, Repairs and Maintenance Expense $49, Miscellaneous Expense $29. The cash on hand at this time was $837.arrow_forwardOn June 1 French company has decided to initiate a petty cash fund in the amount of $800. Prepare journal entries for the following transactions: A. On June 5, the petty cash fund needed replenishment, and the following are the receipts: Auto Expense $37, Supplies $124, Postage Expense $270, Repairs and Maintenance Expense $168, Miscellaneous Expense $149. The cash on hand at this time was $48. B. On June 14, the petty cash fund needed replenishment, and the following are the receipts: Auto Expense $18, Supplies $175, Postage Expense $50, Repairs and Maintenance Expense $269, Miscellaneous Expense $59. The cash on hand at this time was $220. C. On June 23, the petty cash fund needed replenishment, and the following are the receipts: Auto Expense $251, Supplies $88, Postage Expense $63, Repairs and Maintenance Expense $182, Miscellaneous Expense $203. The cash on hand at this time was $20. D. On June 29, the company determined that the petty cash fund needed to be increased to $1,000. E. On June 30, the petty cash fund needed replenishment, as it was month end. The following are the receipts: Auto Expense $18, Supplies $175, Postage Expense $50, Repairs and Maintenance Expense $269, Miscellaneous Expense $59. The cash on hand at this time was $437.arrow_forwardOn May 2 Kellie Company has decided to initiate a petty cash fund in the amount of $1,200. Prepare journal entries for the following transactions: A. On July 5, the petty cash fund needed replenishment, and the following are the receipts: Auto Expense $125, Supplies $368, Postage Expense $325, Repairs and Maintenance Expense $99, Miscellaneous Expense $259. The cash on hand at this time was $38. B. On June 14, the petty cash fund needed replenishment, and the following are the receipts: Auto Expense $425, Supplies $95, Postage Expense $240, Repairs and Maintenance Expense $299, Miscellaneous Expense $77. The cash on hand at this time was $80. C. On June 23, the petty cash fund needed replenishment, and the following are the receipts: Auto Expense $251, Supplies $188, Postage Expense $263, Repairs and Maintenance Expense $182, Miscellaneous Expense $203. The cash on hand at this time was $93. D. On June 29, the company determined that the petty cash fund needed to be decreased to $1,000. E. On June 30, the petty cash fund needed replenishment as it was month-end. The following are the receipts: Auto Expense $114, Supplies $75, Postage Expense $50, Repairs and Maintenance Expense $121, Miscellaneous Expense $39. The cash on hand at this time was $603.arrow_forward
- a. Why would a business use a Petty Cash Fund? b. Describe the entry needed to establish a 50 Petty Cash Fund and an entry to reimburse the fund.arrow_forwardA company has decided to start a petty cash fund for $150. Which of the following is the correct journal entry? A. B. C. No entry is required. D.arrow_forwardRecord the following transactions: A. Started a petty cash fund in the amount of $500. B. Replenished petty cash fund using the following expenses: Auto $24, Office Expenses $43, Postage Expense $19, Miscellaneous Expenses $25. Cash on hand is $389. C. The company has decided to reduce the petty cash fund to $300.arrow_forward
- Record the following transactions: A. Started a petty cash fund in the amount of $200. B. Replenished petty cash fund using the following expenses: Auto $15, Office Expenses $20, Postage Expense $81, Miscellaneous Expenses $66. Cash on hand is $10. C. Increased petty cash by $75.arrow_forwardPetty Cash Fund Entries Journalize the entries to record the following: a. Check is issued to establish a petty cash fund of $800. b. The amount of cash in the petty cash fund is now $272. Check is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $306; miscellaneous selling expense, $127; miscellaneous administrative expense, $79. If the amount of the check to replenish the fund plus the balance in the fund do not equal $800, record the discrepancy in the cash short and over account. a. Journalize the entry to establish the petty cash fund. If an amount box does not require an entry, leave it blank. Petty Cash v Cash v Feedback V Check My Work a. Recall that the only time Petty Cash is used is when the fund is initially established or increased. b. Journalize the entry to replenish the petty cash fund. If an amount box does not require an entry, leave it blank. Office Supplies Miscellaneous Selling Expense Miscellaneous…arrow_forwardJournalize the entries to record the following: Check No. 245-13 is issued to establish a petty cash fund of $600. The amount of cash in the petty cash fund is now $198. Check No. 271-13 is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $233; miscellaneous selling expense, $96; miscellaneous administrative expense, $60. a. Journalize the entry to establish the petty cash fund. Petty Cash fill in the blank 1cd8ceff2fd201b_2 Cash fill in the blank 1cd8ceff2fd201b_4 Feedback a. Recall that the only time Petty Cash is used is when the fund is initially established or increased. Learning Objective 6. b. Journalize the entry to replenish the petty cash fund. For a compound transaction, if an amount box does not require an entry, leave it blank. Office Supplies fill in the blank bd88c5f6e066fba_2 fill in the blank bd88c5f6e066fba_3 Miscellaneous Selling Expense fill in the…arrow_forward
- Required: a. On March 1, check is issued to establish a petty cash fund of $1,050.* b. On April 1, The amount of cash in the petty cash fund is now $106. Check is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $603; miscellaneous selling expense, $183; miscellaneous administrative expense, $136. If the amount of the check to replenish the fund plus the balance in the fund do not equal $1,050, record the discrepancy in the cash short and over account.* https://v2.cengagenow.com/ilrn/createAssignment/printAssignment.do?assignmentld=2942339&answerkey=false 6/8 11/9/21, 1:54 PM CengageNOWv2 | Online teaching and learning resource from Cengage Learning *Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.…arrow_forwardIf a petty cash fund is established in the amount of $348 and contains $200 in cash and $134 in receipts for disbursements when it is replenished, the journal entry to recorn replenishment should include credits to the following accounts: a.) Cash, $134; Cash Over and Short, $14. b.) Petty Cash, $148. c.) Petty Cash, $100. d.) Cash, $148.arrow_forwardInstructions Journalize the necessary entries for each of the following: Required: a. On March 1, issued a check to establish a petty cash fund of $1,410.* b. On April 1, the amount of cash in the petty cash fund is $440. Issued a check to replenish the fund, based on the following summary of petty cash receipts: repair expense, $850, and miscellaneous selling expense, $80. Record any missing funds in the cash short and over account.* *Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. Journal a. On March 1, issued a check to establish a petty cash fund of $1,410. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used…arrow_forward
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