Question

Journalize the entries to record the following:
Check is issued to establish a petty cash fund of $750.
The amount of cash in the petty cash fund is now $176.
Check is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $248; miscellaneous selling expense, $212; miscellaneous administrative expense, $96. (Because the amount of the check to replenish the fund plus the balance in the fund do not equal $750,
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.

Answer 1

Answer: Please see below

Explanation:

a. Journal to record the entry to establish the petty cash fund.

Account Particulars                 Debit           Credit

Petty Cash                               $750

Cash                                                                $750

b. Journal to record  the entry to replenish the petty cash fund.

Account Particulars                 Debit                     Credit

Office Supplies                         $248

Misc Selling Expense               $212  

Miscellaneous administrative expense, $96.                  

Cash Short and Over                 $18

Cash                                                                       $574

To calculate Cash Short and Over=  $750-(248+212+ 96)= 750 -556= $194

but the money in the pettycash fund On April 1 is $212.

therefore Cash short and over = $212-$194 = $18