The petty cash fund of CHF200 for the Hansen Company appeared as follows on July 31, 2014: On July 31, the office manager gives instruction to increase the petty cash fund to CHF300. The journal entry to increase the petty cash fund would include

Question

The petty cash fund of CHF200 for the Hansen Company appeared as follows on July 31, 2014:  On July 31, the office manager gives instruction to increase the petty cash fund to CHF300. The journal entry to increase the petty cash fund would include

Quizplus · Accepted Answer

To increase the petty cash fund from CHF200 to CHF300, a debit to Petty Cash for the increase amount of CHF100 is required. This means that the new balance of the Petty Cash account would be CHF300. No credit to Cash is needed as the petty cash fund is still held in cash, just in a larger amount.

The Petty Cash Fund of CHF200 for the Hansen Company