DogCo has a petty cash fund of $265. At the end of the month, $10 remains in the fund along with $258 in various receipts. The journal entry to replenish the fund would be to:

Question

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To replenish the petty cash fund, we need to debit various expenses for the total receipts amount ($258) and credit the main cash account for the same amount ($258). However, since there is a cash shortage of $3 ($265 initial fund - $10 remaining in the fund = $255, which is less than the total receipts of $258), we need to credit Cash Over for the shortage amount ($3) and credit Cash for the actual replenishment amount ($255). Therefore, the correct journal entry would be to debit various expenses, $258; credit Cash Over for $3 and credit Cash for $255.

DogCo Has a Petty Cash Fund of $265