Corporate Financial Accounting
15th Edition
ISBN: 9781337398169
Author: Carl Warren, Jeff Jones
Publisher: Cengage Learning
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Question
Chapter 7, Problem 7.24EX
(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.
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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Petty Cash Fund Entries
Journalize the entries to record the following:
a. Check No. 12-375 is issued to establish a petty cash fund of
$800.
b. The amount of cash in the petty cash fund is now $288. Check
No. 12-476 is issued to replenish the fund, based on the
following summary of petty cash receipts: office supplies,
$4297; miscellaneous selling expense, $123; miscellaneous
administrative expense, $77. (Because the amount of the check
to replenish the fund plus the balance in the fund do not equal
$500, 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.
88
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.
Petty Cash Fund Entries
Journalize the entries to record the following:
Check No. 12-375 is issued to establish a petty cash fund of $1,000.
The amount of cash in the petty cash fund is now $370. Check No. 12-476 is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $365; miscellaneous selling expense, $151; miscellaneous administrative expense, $95. (Because the amount of the check to replenish the fund plus the balance in the fund do not equal $500, 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.
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.
Petty 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…
Chapter 7 Solutions
Corporate Financial Accounting
Ch. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - Prob. 3DQCh. 7 - Why should the responsibility for maintaining the...Ch. 7 - Assume that Brooke Miles, accounts payable clerk...Ch. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 10DQ
Ch. 7 - Prob. 7.1BECh. 7 - Prob. 7.2BECh. 7 - Prob. 7.3BECh. 7 - Prob. 7.4BECh. 7 - Days cash on hand Financial statement data for...Ch. 7 - Prob. 7.1EXCh. 7 - Prob. 7.2EXCh. 7 - Prob. 7.3EXCh. 7 - Prob. 7.4EXCh. 7 - Prob. 7.5EXCh. 7 - Prob. 7.6EXCh. 7 - Prob. 7.7EXCh. 7 - Prob. 7.8EXCh. 7 - Prob. 7.9EXCh. 7 - Prob. 7.10EXCh. 7 - Prob. 7.11EXCh. 7 - Entry for cash sales; cash short The actual cash...Ch. 7 - Entry for cash sales; cash over The actual cash...Ch. 7 - Internal control of cash payments Abbe Co. is a...Ch. 7 - Prob. 7.15EXCh. 7 - Prob. 7.16EXCh. 7 - Prob. 7.17EXCh. 7 - Prob. 7.18EXCh. 7 - Prob. 7.19EXCh. 7 - Prob. 7.20EXCh. 7 - Prob. 7.21EXCh. 7 - Prob. 7.22EXCh. 7 - Prob. 7.23EXCh. 7 - Prob. 7.24EXCh. 7 - Prob. 7.1APRCh. 7 - Prob. 7.2APRCh. 7 - Prob. 7.3APRCh. 7 - Prob. 7.4APRCh. 7 - Prob. 7.5APRCh. 7 - Prob. 7.1BPRCh. 7 - Prob. 7.2BPRCh. 7 - Prob. 7.3BPRCh. 7 - Prob. 7.4BPRCh. 7 - Prob. 7.5BPRCh. 7 - Analyze and compare Amazon.com to Netflix...Ch. 7 - Analyze and compare J. C. Penney and Macys J. C....Ch. 7 - Prob. 7.3MADCh. 7 - Prob. 7.4MADCh. 7 - Prob. 7.5MADCh. 7 - Ethics in Action Tehra Dactyl is an accountant for...Ch. 7 - Bank error During the preparation of the bank...Ch. 7 - Prob. 7.4TIFCh. 7 - Prob. 7.5TIF
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- On 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 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 July 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 $110. 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 $14, Supplies $75, Postage Expense $150, Repairs and Maintenance Expense $121, Miscellaneous Expense $39. The cash on hand at this time was $603.arrow_forward
- On 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_forwardRecord the following transactions: A. Started a petty cash fund in the amount of $1,000. B. Replenished petty cash fund using the following expenses: Auto $61, Office Expenses $23, Postage Expense $57, Miscellaneous Expenses $30. C. The company has decided to reduce the petty cash fund to $600.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
- 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_forwardRecord the following transactions: A. Started a petty cash fund in the amount of $575 B. Replenished petty cash fund using the following expenses: Auto $18, Office Expenses $35, Postage Expense $56, Miscellaneous Expenses $67. Cash on hand is $399. C. Increased petty cash by $25.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_forward
- Petty Cash Fund Entries Journalize the entries to record the following: Check No. 12-375 is issued to establish a petty cash fund of $500.The amount of cash in the petty cash fund is now $165. Check No. 12-476 is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $194; miscellaneous selling expense, $80; miscellaneous administrative expense, $50. (Because the amount of the check to replenish the fund plus the balance in the fund do not equal $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.arrow_forwardJournalize 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.arrow_forwardPetty Cash Fund Entries Journalize the entries to record the following: Check is issued to establish a petty cash fund of $600. The amount of cash in the petty cash fund is now $198. Check 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. (Because the amount of the check to replenish the fund plus the balance in the fund do not equal $600, record the discrepancy in the cash short and over account.) a. Journalize the entry to establish the petty cash fund. fill in the blank b45865f5d05b007_2 fill in the blank b45865f5d05b007_4 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. fill in the blank 44236403e05a042_2 fill in the blank 44236403e05a042_3 fill in the blank 44236403e05a042_5 fill in the blank…arrow_forward
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