Question

The following Petty Cash transactions took place at Ceraves during the month of August (ignore GST):

1 August	Established a petty cash float for $250
31 August	Petty Cash count confirmed balance of $61.80 remaining
	Receipts for the following presented for the month of August:
	Staff Amenities	$	38.80
	Taxi Fares	$	72.00
	Postage	$	77.40

REQUIRED:

Prepare journal entries for:

1. Establishment of the Petty Cash fund
2. Reimbursement of Petty Cash for August expenses

Answer 1

Solution:
	Journal Entries
	Date	Account Title and explanation	Debit	Credit
	August . 01	Petty Cash	$                        250
		Cash		$                           250
		(To record the petty cash establishment)
	August . 31	Petty Cash	$                  188.20
		Cash		$                     188.20
		(To record the replenishment cash )
	Working Notes: 1
		CALCULATION OF THE SHORTAGE OF PETTY CASH
		Received the petty cash =	$                        250
		Less: Expenses
		Staff Amenities	$                     38.80
		Taxi Fares	$                     72.00
		Postage	$                     77.40
		Total Expenses	$                  188.20
		Balance	$                     61.80
		Less: Actual Balance in hand	$                     61.80
		Cash Shortage & Over	$                            -