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Question E7-22

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Intermediate Accounting (Kieso)
Found in: Page 369

Short Answer

(Petty Cash) Carolyn Keene, Inc. decided to establish a petty cash fund to help ensure internal control over its small cash expenditures. The following information is available for the month of April.

1. On April 1, it established a petty cash fund in the amount of $200.

2. A summary of the petty cash expenditures made by the petty cash custodian as of April 10 is as follows

Delivery charges paid on merchandise purchased

$60

Supplies Purchased and used

25

Postage expenses

33

I.O.U from employees

17

Miscellaneous expenses

36

The petty cash fund was replenished on April 10. The balance in the fund was $27.

3. The petty cash fund balance was increased $100 to $300 on April 20.

Instructions

Prepare the journal entries to record transactions related to petty cash for the month of April

Cash short and over totals $2.

See the step by step solution

Step by Step Solution

Definition of Miscellaneous Expenses

A ledger account that reports all the minor expenses made by the business entity is known as a miscellaneous expense.

Journal Entries

Date

Accounts and Explanation

Debit $

Credit $

April 1

Petty cash

$200

Cash

$200

April 10

Delivery charges

$60

Supplies expenses

$25

Postage expenses

$33

I.O.U from employees

$17

Miscellaneous expenses

$36

Cash over and short

$2

Cash

$173

April 20

Petty cash

$100

Cash

$100

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