A company had $43 missing from petty cash that was not accounted for by petty cash receipts. The correct procedure is to:
A) Debit Cash Over and Short for $43.
B) Debit Petty Cash for $43.
C) Credit Cash Over and Short for $43.
D) Credit Petty Cash for $43.
E) Credit Cash for $43.

Question

Quizplus · Accepted Answer

When there is a cash shortage or overage in the petty cash account, it should be recorded in a separate account called Cash Over and Short. This account is used to record the difference between the amount of cash in the petty cash box and the total of the receipts. Since there is a $43 shortage in this case, we would debit Cash Over and Short for $43 to record the shortage.

A Company Had $43 Missing from Petty Cash That Was