A $100 petty cash fund has cash of $12 and receipts of $85.The journal entry to replenish the account would include a credit to

Question

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The correct journal entry to replenish the petty cash account includes crediting Cash for $88. This is because the total amount spent from the petty cash ($85 in receipts plus the remaining cash of $12) totals $97, indicating that $3 is unaccounted for. Since the fund should be replenished back to $100, you need to add $88 ($100 - $12 remaining cash) to bring the fund back to its original amount. The discrepancy is addressed separately in the journal entry, not directly in the credit to Cash.

A $100 Petty Cash Fund Has Cash of $12 and Receipts