Assume that the custodian of a $450 petty cash fund has $65 in coins and currency plus $382 in receipts at the end of the month. The entry to replenish the petty cash fund will include:

Question

Quizplus · Accepted Answer

To replenish the petty cash fund, we need to debit the Petty Cash account for the amount spent during the month, which is $385 ($65 in coins and currency + $382 in receipts). We also need to credit the Cash account for the same amount, as we are reducing the amount of cash on hand. Therefore, the correct entry to replenish the petty cash fund would be a debit to Petty Cash for $385 and a credit to Cash for $385. The other options are not applicable as there is no Cash Over and Short and the total amount spent is not equal to $450.

Assume That the Custodian of a $450 Petty Cash Fund