A petty cash fund of $100 is replenished when the fund contains $5 in cash and receipts for $93. The entry to replenish the fund would include a
A) credit to Cash Over and Short for $2.
B) credit to Miscellaneous Revenue for $2.
C) debit to Cash Over and Short for $2.
D) debit to Miscellaneous Expense for $2.

Question

Quizplus · Accepted Answer

The entry to replenish a petty cash fund involves debiting the expense accounts that were paid with petty cash and crediting the petty cash account for the amount spent. In this case, since the petty cash fund contains only $5 and the receipts show expenses of $93, a debit of $93 is made to various expense accounts and a credit of $98 ($5 + $93) is made to the petty cash account. This leaves an overage of $2 ($100 - $98) which is debited to the Cash Over and Short account.

A Petty Cash Fund of $100 Is Replenished When the Fund