Question

Problem 8 (LO3) PETTY CASH PAYMENTS RECORD AND JOURNAL ENTRIES

On April 1, the Fitzgibbons Furniture Repair Shop established a petty cash fund of $200. The following cash payments were made from the petty cash fund during the first two weeks of April. The fund was replenished to the $200 level on April 16. Apr.

1 Paid $5.28 for postage due on a package received. Petty Cash Voucher No. 10.

5 Made a $25 contribution to the Washington Township Baseball League. Petty Cash Voucher No. 11.

6 Reimbursed $6.25 to an employee for phone calls made from a pay phone. Petty Cash Voucher No. 12.

8 Paid $22 for office supplies. Petty Cash Voucher No. 13.

10 Paid $32 for a newspaper advertisement. Petty Cash Voucher No. 14.

12 Paid $33 for an oil change for the company truck. Petty Cash Voucher No. 15.

14 Paid $20 for postage stamps. Petty Cash Voucher No. 16.

15 Made a $25 contribution to the Girl Scouts. Petty Cash Voucher No. 17.

Required: 1. Prepare the journal entry to establish the petty cash fund. 2. Enter the above payments in the petty cash payments record provided on page 113. 3. Prove the petty cash payments record. 4. Prepare the journal entry to replenish the fund on April 16.

Answer 1

1. Journal Entries

Date	Particulars	Debit	Credit
Apr 1	Postage Exps	5.28
	Petty Cash		5.28
Apr 5	Contribution	25
	Petty Cash		25
Apr 6	Telephone Exps	6.25
	Petty Cash		6.25
Apr 8	Office Supplies	22
	Petty Cash		22
Apr 10	Advirsement	32
	Petty Cash		32
Apr 12	Oil Exps	33
	Petty Cash		33
Apr 14	Postage Exps	20
	Petty Cash		20
Apr 15	Contribution	25
	Petty Cash		25

2. & 3. Petty Cash Payments Record

Day	Description	Vou No.	Total Amount	Postage Exps	Contribution	Tele Exps	Office Supplies	Advertisement	Oil Exps	Account	Amount
Apr 1	Opening Balance		200							Petty Cash	200
1	Postage Exps	10	5.28	5.28						Postage Exps	5.28
5	Contribution	11	25		25					Contribution	25
6	Telephone Exps	12	6.25			6.25				Telephone Exps	6.25
8	Office Supplies	13	22				22			Office Supplies	22
10	Advertisement	14	32					32		Advertisement	32
12	Oil Expense	15	33						33	Oil Expense	33
14	Postage Exps	16	20	20						Postage Exps	20
15	Contribution	17	25		25					Contribution	25
Total			368.53	25.28	50	6.25	22	32	33		368.53

4. Journal Entry to Replenish funds.

Apr 16	Petty Cash (200 - 168.53)	168.53
	Cash (200 - 168.53)		168.53