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Financial & Managerial Accounting
Found in: Page 310
Financial & Managerial Accounting

Financial & Managerial Accounting

Book edition 7th
Author(s) John J Wild, Ken W. Shaw, Barbara Chiappetta
Pages 1096 pages
ISBN 9781259726705

Short Answer

Nakashima Gallery had the following petty cash transactions in February of the current year.

Feb. 2 Wrote a $400 check, cashed it, and gave the proceeds and the petty cashbox to Chloe Addison, the petty cashier.

5 Purchased paper for the copier for $14.15 that is immediately used.

9 Paid $32.50 COD shipping charges on merchandise purchased for resale, terms FOB shipping point. Nakashima uses the perpetual system to account for merchandise inventory.

12 Paid $7.95 postage to deliver a contract to a client.

14 Reimbursed Adina Sharon, the manager, $68 for mileage on her car.

20 Purchased stationery for $67.77 that is immediately used.

23 Paid a courier $20 to deliver merchandise sold to a customer, terms FOB destination.

25 Paid $13.10 COD shipping charges on merchandise purchased for resale, terms FOB shipping point.

27 Paid $54 for postage expenses.

28 The fund had $120.42 remaining in the petty cashbox. Sorted the petty cash receipts by accounts affected and exchanged them for a check to reimburse the fund for expenditures.

28 The petty cash fund amount is increased by $100 to a total of $500.

Required

2. Prepare a petty cash payment report for February with these categories: delivery expense, mileage expense, postage expense, merchandise inventory (for transportation-in), and office supplies expense. Sort the payments into the appropriate categories and total the expenditures in each category.

Answer

The Petty cash payment reports show the total expenditure as $277.47.

See the step by step solution

Step by Step Solution

Step-by-Step SolutionStep 1: Introduction to topic

Petty Cash Payments Report: The petty cash report should incorporate the date, the cash transfers into petty cash, details regarding the exchange, the sum circulated, and a running balance. When your balance reaches a point where you need a renewal sum, then you need to prepare a check to take petty cash to get back to the original funded amount.

Step 2: Petty Cash Payments Report

Shelton Gallery

Petty Cash Payments Report

Delivery expense

Feb. 23

Delivery of customer's merchandise

$20

Mileage expense

Feb. 14

Reimbursement for mileage

$68

Postage expense

Feb. 12

Express delivery of contract

$7.95

Feb. 27

Purchased postage stamps

$54

$61.95

Merchandise inventory (transportation-in)*

Feb. 9

COD charges on purchases

$32.50

Feb. 25

COD charges on purchases

$13.10

$45.6

Office supplies expense

Feb. 5

Purchased paper for copier

$14.15

Feb. 20

Purchased stationery

$67.77

$81.92

Total

$277.47

Most popular questions for Business-studies Textbooks

Chavez Company most recently reconciled its bank statement and book balances of cash on August 31 and it reported two checks outstanding, No. 5888 for $1,028.05 and No. 5893 for $494.25. The following information is available for its September 30, 2017, reconciliation.

From the September 30 Bank Statement 16,800.45 9,620.05 11,272.85 18,453.25 PREVIOUS BALANCE TOTAL CHECKS AND DEBITS TOTAL DEPOSITS AND CREDITS CURRENT BALANCE Date 09/03 09/04 09/07 09/20 09/17 09/22 09/22 09/28 09/29 CHECKS AND DEBITS DEPOSITS AND CREDITS 5888 1,028.05 09/05 1,103.75 No. Amount Date Amount 5902 719.90 09/12 2,226.90 5901 1,824.25 09/21 4,093.00 5905 937.00 09/30 12.50 IN 09/25 2,351.70 5903 399.10 09/30 1,485.00 CM 5904 5907 5909 2,090.00 213.85 1,807.65

From Chavez Company’s Accounting Records Cash Acct. No. 101 Date Explanation PR Debit Credit Balance Aug. 31 Balance 15,278.15 Sep. 30 Total receipts R12 11,458.10 26,736.25 30 Total disbursements D23 9,332.05 17,404.20 Cash Receipts Deposited Cash Date Debit Sep. 5 1,103.75 12 2,226.90 21 4,093.00 25 2,351.70 30 1,682.75 11,458.10 Cash Disbursements Check Cash No. Credit 5901 1,824.25 5902 719.90 5903 399.10 5904 2,060.00 5905 937.00 5906 982.30 5907 213.85 5908 388.00 5909 1,807.65 9,332.05

Additional Information

Check No. 5904 is correctly drawn for $2,090 to pay for computer equipment; however, the recordkeeper misread the amount and entered it in the accounting records with a debit to Computer Equipment and a credit to Cash of $2,060. The NSF check shown in the statement was originally received from a customer, S. Nilson, in payment of her account. Its return has not yet been recorded by the company. The credit memorandum (CM) is from the collection of a $1,500 note for Chavez Company by the bank. The bank deducted a $15 collection expense. The collection and fee are not yet recorded.

Required

Analysis Component

3. The bank statement reveals that some of the prenumbered checks in the sequence are missing. Describe three situations that could explain this.

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