Question

5. Felix Stamp owns a car parts dealership. Most of his payments from customers are made in cash and by direct deposit to the bank. He has few debtors. The cash book page for the month of March 2019 has been mistakenly removed. He has to rely on his source documents, ledgers and bank statement to recreate certain accounts.

i. Name a source document that Felix Stamp would use to draw up his Petty Cash Book.

(1 mark)

ii. Felix Stamp keeps a petty cash imprest of $200 for the business. The cashier reports that there was an unspent balance of $47.10 in the Petty Cash Book on 01 March 2019.

Calculate the amount needed to restore the imprest.

(2 mark)

iii. The cashier produces the following list of small expenditures for the month of March 2019.

March Details $

3 Postage stamps 12.75

6 Messenger's taxi fare 9.65

9 Mop and broom 25.60

13 Envelopes 14.00

17 Cleaning supplies 18.85

22 Copy paper 60.00

27 Glue sticks 7.50

30 Messenger's taxi fare 9.65

Draw up Felix Stamp’s Petty Cash Book for the month of March 2019 using the following headings: Postage and Stationary, Cleaning Expenses and Travel Expenses. Balance off the Petty Cash Book and prepare for the beginning of the next month.

Answer 1

i) Source Document: Payment Vouchers

The source document which the company can rely upon is the payment vouchers or the bills received while making the payment and to cross verify the amount withdrawn from bank, the respective bank statement could be checked.

ii)

Petty Cash Imprest Balance to be maintained = $200.00

Opening Balance on 01-Mar-2019 =  $ 47.10

Amount required to restore imprest = $200.00 -  $ 47.10 = $152.90