In: Accounting
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, $1,231. Cash count, $1,523. 26 Cash sales per the cash register tape, $1,341. Cash count, $1,634. 27 Cash sales per the cash register tape, $1,352. Cash count, $1,655. 28 Cash sales per the cash register tape, $1,283. Cash count, $1,576. 29 Cash sales per the cash register tape, $1,128. Cash count, $1,433. 30 Cash sales per the cash register tape, $1,369. Cash count, $1,662. Required: Record the cash receipts from June 25 to June 30, 2019, in a general journal. Post the amounts for Cash Short or Over in the journal entries to the general ledger. Analyze: How will the balance in Cash Short or Over on June 30 be reported in the financial statements?
Solution:
1. Record the cash receipts from June 25 to June 30, 2019, in a general journal.
Date | Account titles and explaination | Debit($) | Credit($) | Calculations |
June 25 | Cash A/c Dr | $1,223 | ||
Cash short or over A/c Dr | $8 | ($300 + $1,231 - $1,523) | ||
To sales revenue A/c | $1,231 | |||
June 26 | Cash A/c Dr | $1,334 | ||
Cash short or over A/c Dr | $7 | ($300 + $1,341 - $1,634) | ||
To sales revenue A/c | $1,341 | |||
June 27 | Cash A/c Dr | $1,355 | ||
To Cash short or over A/c | $3 | ($300 + $1,352 - $1,655) | ||
To sales revenue A/c | $1,352 | |||
June 28 | Cash A/c Dr | $1,276 | ||
Cash short or over A/c Dr | $7 | ($300 + $1,283 - $1,576) | ||
To sales revenue A/c | $1,283 | |||
June 29 | Cash A/c Dr | $1,133 | ||
To Cash short or over A/c | $5 | ($300 + $1,128 - $1,433) | ||
To sales revenue A/c | $1,128 | |||
June 30 | Cash A/c Dr | $1,362 | ||
Cash short or over A/c Dr | $7 | ($300 + $1,369 - $1,662) | ||
To sales revenue A/c | $1,369 | |||
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2. Post the amounts for Cash Short or Over in the journal entries to the general ledger.
Date | Debit($) | Date | Credit($) |
June 25 | $8 | June 27 | $3 |
June 26 | $7 | June 29 | $5 |
June 28 | $7 | ||
June 30 | $7 | ||
June 30 Balance | $21 ($29 - $8) |
Analysis:
The cash short or over account has a debit balance of $21 on june 30 which will be reported as an expense in the income statement of Royal Jewels.