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FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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
Transcribed Image Text:Exercise 6-14A (Algo) Effect of petty cash events on the financial statements LO 6-4
Fresh Foods established a petty cash fund of $94 on January 2. On January 31, the fund contained cash of $9.40 and vouchers for the
following cash payments:
Maintenance expense
Office supplies
Transportation expense
The four distinct accounting events affecting the petty cash fund for the period were (1) establishment of the fund, (2) reimbursements
made to employees, and (3) recognition of expenses including any amount of cash short or over and (4) replenishment of the fund.
Assume the Company uses the alternative approach to petty cash expense recognition and replenishment.
Required
Show each of the four events in the following horizontal statements model. (Enter any decreases to account balances with a minus
sign. For changes on the Statement of Cash Flows, indicate whether the item is an operating activity (OA), investing activity (IA),
financing activity (FA), or leave the cell blank if there is no effect. Round your answers to 2 decimal places.)
No
1234
1.
Cash
Assets
+ Petty Cash
(94.00)+
+
Balance Sheet
+
+
$28.20
37.60
18.80
94.00 =
(84.60) =
FRESH FOODS
Horizontal Statements Model
Stockholders'
Equity
Retained
Earnings
(84.60)
Revenue
Income Statement
Expense
= Net Income
84.60 =
(84.60)
Statement of Cash
Flows
(84.60)
OA
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