The journal entry to open a new petty cash fund includes a debit to the petty cash account and a credit to cash in bank.

Name: The journal entry to open a new petty cash fund includes a debit to the petty cash account and a credit to cash in bank.
Brand: Quizplus
Rating: 4.7 (38 reviews)

Question

Quizplus · Accepted Answer

This is correct. When opening up a petty cash fund, the petty cash account is debited to record the increase in assets, and Cash in Bank is credited to reflect that the money for the fund came from the organization's bank account.

The Journal Entry to Open a New Petty Cash Fund