Question

Sun Company has decided to use a petty cash fund. Transactions involving this fund follow:

June 4 Set up a petty cash fund of $ 225.

22 When the fund had a cash amount of $ 31.35, the custodian of the fund was reimbursed for expenditures made, including:

Transportation-in	$ 82.50
Postage	27.00
Office supplies	81.75

30 The fund was reimbursed to include petty cash items in the financial statement prepared for the fiscal year ending on this date. The fund had the following cash and vouchers before reimbursement:

Coins and currency	$174.00
Petty cash vouchers for:
Employee’s IOU	15.00
Postage	27.00
Office supplies	11.10

July 1 The petty cash fund balance is increased to $ 300.

Prepare journal entries for all of these transactions.

Answer 1

		Sun Company
		Journal Entries
Date	Accounts Title and explanation				Debit	Credit
Jun-04	Petty cash				225.00
		Cash				225.00
	(Amount given for establishing petty cash)
Jun-22	Transportation in				82.50
	Postage				27.00
	Office Supplies				81.75
		Petty Cash				191.25
	(Petty cash expenses incurred during the period)
Jun-22	Petty Cash				191.25
		Cash				191.25
	(Reimbursed the petty cash expenses incurred)
Jun-30	Employee				15.00
	Postage				27.00
	Office Supplies				11.10
		Petty Cash				53.10
	(Petty cash expenses incurred during the period)
Jun-30	Petty Cash				53.10
		Cash (225.00-174.00)				51.00
		Cash Short and Over				2.10
	(Petty cash expenses reimbursed. Excess amount
	transferred to cash short and over)
Jul-01	Petty Cash (300.00-225.00)				75.00
		Cash				75.00
	(To raise petty cash upto $300)