Question

Royal Jewels, a retail business, started business on June 25, 2019. It keeps a $300 change fund in its cash register. The cash receipts for the period from June 25 to June 30, 2019 are below.

DATE		TRANSACTIONS
June	25	Cash sales per the cash register tape, $1,222.
		Cash count, $1,516.
	26	Cash sales per the cash register tape, $1,335.
		Cash count, $1,627.
	27	Cash sales per the cash register tape, $1,343.
		Cash count, $1,648.
	28	Cash sales per the cash register tape, $1,277.
		Cash count, $1,569.
	29	Cash sales per the cash register tape, $1,124.
		Cash count, $1,426.
	30	Cash sales per the cash register tape, $1,363.
		Cash count, $1,655.

Required:

2. Record the cash receipts from June 25 to June 30, 2019, in a general journal.
3. Post the amounts for Cash Short or Over in the journal entries to the general ledger.

Analyze:
How will the balance in Cash Short or Over on June 30 be reported in the financial statements?

Answer 1

Calculation of cash shortage/cash over
	Cash count	Change Fund	Amount banked(Cash count - Change fund)	Cash sales as per cash register tape	Cash over (Amount Banked - Cash sales)	Cash shortage (Cash sales-Amount banked)
25-Jun	$1,516	$300	$1,216	$1,222	NA	$6
26-Jun	$1,627	$300	$1,327	$1,335	NA	$8
27-Jun	$1,648	$300	$1,348	$1,343	$5	NA
28-Jun	$1,569	$300	$1,269	$1,277	NA	$8
29-Jun	$1,426	$300	$1,126	$1,124	$2	NA
30-Jun	$1,655	$300	$1,355	$1,363		$8

Journal entries to record cash short or over
Date	Particulars	Debit Amount	Credit Amount
25-Jun	Cash	$1,216
	Cash short or over	$6
	Sales revenue		$1,222
26-Jun	Cash	$1,327
	Cash short or over	$8
	Sales revenue		$1,335
27-Jun	Cash	$1,348
	Cash short or over		$5
	Sales revenue		$1,343
28-Jun	Cash	$1,269
	Cash short or over	$8
	Sales revenue		$1,277
29-Jun	Cash	$1,126
	Cash short or over		$2
	Sales revenue		$1,124
30-Jun	Cash	$1,355
	Cash short or over		$8
	Sales revenue		$1,363

Ledger account
	Cash Short or Over A/c
Date	Particulars	Debit Amount	Date	Particulars	Credit Amount
25-Jun	Sales revenue	$6	27-Jun	Cash	$5
26-Jun	Sales revenue	$8	29-Jun	Cash	$2
28-Jun	Sales revenue	$8	30-Jun	Cash	$8
			30-Jun	Balance	$7
		$22			$22