A company established a petty cash fund in April of the current year and experie

Question

A company established a petty cash fund in April of the current year and experienced the following transactions affecting the fund during April. Prepare journal entries to establish the fund on April 1, replenish it on April 25, and to record the increase in the fund on April 25. April Prepared a company check for $300.00 to establish the petty cash fund. 25 Prepared a company check to replenish the fund for the following expenditures made since April 1 Paid $84.50 for cleaning services. Paid $84.00 for postage expense Paid $103.15 for office supplies. Counted $23.35 remaining in the petty cash box 25 The company decides to increase the fund by $100

Explanation / Answer

Required journal entries are as prepared below:

Date Particulars L.F Amount ($) Amount ($) Apr-01 Petty Cash 300 Cash 300 (For petty cash fund established) Apr-25 Cleaning Expenses 84.5 Postage Expenses 84 Office Supplies 103.15 Cash over and short 5 Petty cash 276.65 (For petty cash fund was replenished) Apr-30 Petty Cash 376.65 Cash 376.65 (For petty cash fund increased)

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