Rosemond Company establishes a $300 petty cash fund on September 9. On September 30, the fund shows $54 in cash along with receipts for the following expenditures: office supplies, $40; postage expenses, $123; and miscellaneous expenses, $80. The petty cashier could not account for a $3 shortage in the fund. The September 9 journal entry to establish the fund is.

Question

Quizplus · Accepted Answer

The journal entry to establish the petty cash fund on September 9 is:
Petty cash 			300
Cash in bank 		300

On September 30, the petty cash fund has $54 in cash and receipts totaling $243. Therefore, the total disbursements are $297 ($243 spent + $54 remaining cash). The shortage of $3 is recorded as an expense to Miscellaneous expenses.

Office supplies expense	40
Postage expenses		123
Miscellaneous expenses	80 
Cash over and short				3
Petty cash									297

The entry in the general journal will then be:
Debit		Credit
Office Supplies Expenses 	$40
Postage Expenses		$123
Miscellaneous Expenses	$83
Cash Over and Short	$3
Petty Cash		$297

Rosemond Company Establishes a $300 Petty Cash Fund on September