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Financial & Managerial Accounting
Found in: Page 305
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

2. Identify the two events from the following that cause a Petty Cash account to be credited in a journal entry.

a. Fund amount is being reduced. c. Fund is being eliminated.

b. Fund amount is being increased. d. Fund is being established

Answer

Fund amount is being reduced, or Fund is being eliminated is to be credited in a journal entry.

See the step by step solution

Step by Step Solution

Step-by-Step SolutionStep 1: Meaning of Petty Cash Fund

A petty cash fund is a tiny amount of an organization's cash used to pay for day-to-day expenses and minor or incidental costs, such as office supplies or miscellaneous expenses.

Step 2: Identifying the two credit accounts

The Petty Cash account is credited when either of the followings-

a. Fund amount is being reduced

c. Fund is being eliminated

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