Alpha Company established a petty cash fund on July 1, 2017 by writing a cheque in the amount of $500 and placing the proceeds into a strong box.
Alpha Company established a petty cash fund on July 1, 2017 by writing a cheque in the amount of $500 and placing
the proceeds into a strong box. The custodian, Mr. Faithfully Honest, accepted the responsibility for the petty cash fund on that date. The following petty cash events occurred based on the receipts that Mr. Honest had in his strong box:
8/10 Office Supplies for immediate use $50
8/11 Gasoline for company car $45
8/19 Postage for immediate use $25
8/29 Office Machine Repair $75
The amount of petty cash in the strong box on August 31st prior to reconciliation was $310. On August 31st, the petty cash was reconciled and replenished by issuing a cheque to Mr. Honest.
The following petty cash events occurred based on the receipts that Mr. Honest had in his strong box:
9/5 Postage for immediate use $25
9/12 Office Supplies for immediate use $45
9/12 Gasoline for company car $50
9/25 FedEx shipping to customer, FOB Destination $55
9/26 New Office Adding Machine $175
The Amount of petty cash in the strong box on September 30th prior to reconciliation was $140. On September 30th, the petty cash was reconciled and replenished by issuing a cheque to Mr. Honest to include an amoun that would increase the authorized balance of the petty cash fund to a total of $600. Use this information to prepare, the general journal entires (compound entry when requried& without explanations) for:
a. August 1 – establishment of Petty Cash fund
b. August 31 – replenishment
c. September 30 – replenishment & increase funding for Petty Cash
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