Ernest Company uses an imprest petty cash system. The fund was established on Ma

Question

Ernest Company uses an imprest petty cash system. The fund was established on March 1 with a balance of $200. During March the following petty cash receipts were found in the petty cash box. Receipt No. Amount $76 42 Date 3/5 Stamp Inventory Freight-Out Miscellaneous Expense Travel Expense Miscellaneous Expense 14 10 The fund was replenished on March 15 when the fund contained $6 in cash. On March 20, the amount in the fund was increased to $300. Instructions Journalize the entries in March that pertain to the operation of the petty cash fund.

Explanation / Answer

Journal entries Accounting titles & Explanations Debit Credit petty cash fund 200 cash 200 Stamp inventory 76 Freight out 42 miscellaneous expense 32 travel expense 44 cash 194 petty cash 100 cash 100

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