Exercise 8-10 (Algo) Petty cash fund accounting LO P2 Palmona Company establishes a $140 petty cash fund on January 1. On January 8, the fund shows $37 in cash along with receipts for the following expenditures: postage, $45; transportation-in, $11; delivery expenses, $13; and miscellaneous expenses, $34. Palmona uses the perpetual system in accounting for merchandise inventory. 1. Prepare the entry to establish the fund on January 1. 2. Prepare the entry to reimburse the fund on January 8 under two separate situations: a. To reimburse the fund. b. To reimburse the fund and increase it to $190. Hint. Make two entries.
Exercise 8-10 (Algo) Petty cash fund accounting LO P2 Palmona Company establishes a $140 petty cash fund on January 1. On January 8, the fund shows $37 in cash along with receipts for the following expenditures: postage, $45; transportation-in, $11; delivery expenses, $13; and miscellaneous expenses, $34. Palmona uses the perpetual system in accounting for merchandise inventory. 1. Prepare the entry to establish the fund on January 1. 2. Prepare the entry to reimburse the fund on January 8 under two separate situations: a. To reimburse the fund. b. To reimburse the fund and increase it to $190. Hint. Make two entries.
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter5: Cash Control Systems
Section: Chapter Questions
Problem 4AP
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![Exercise 8-10 (Algo) Petty cash fund
accounting LO P2
Palmona Company establishes a $140 petty
cash fund on January 1. On January 8, the fund
shows $37 in cash along with receipts for the
following expenditures: postage, $45;
transportation-in, $11; delivery expenses, $13;
and miscellaneous expenses, $34. Palmona
uses the perpetual system in accounting for
merchandise inventory.
1. Prepare the entry to establish the fund on
January 1.
2. Prepare the entry to reimburse the fund on
January 8 under two separate situations:
a. To reimburse the fund.
b. To reimburse the fund and increase it to
$190. Hint. Make two entries.
View transaction list
Journal entry worksheet
<
1
2
Date
January 01
3
Record the journal entry to establish the petty cash fund.
Note: Enter debits before credits.
Record entry
4
General Journal
Clear entry
Debit
Credit
View general journal
>](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff97de970-42c9-4f0f-85f6-0a4a37bc8afa%2Fcd77124e-106b-44e0-a5aa-a6da65954824%2F0zy77g6_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 8-10 (Algo) Petty cash fund
accounting LO P2
Palmona Company establishes a $140 petty
cash fund on January 1. On January 8, the fund
shows $37 in cash along with receipts for the
following expenditures: postage, $45;
transportation-in, $11; delivery expenses, $13;
and miscellaneous expenses, $34. Palmona
uses the perpetual system in accounting for
merchandise inventory.
1. Prepare the entry to establish the fund on
January 1.
2. Prepare the entry to reimburse the fund on
January 8 under two separate situations:
a. To reimburse the fund.
b. To reimburse the fund and increase it to
$190. Hint. Make two entries.
View transaction list
Journal entry worksheet
<
1
2
Date
January 01
3
Record the journal entry to establish the petty cash fund.
Note: Enter debits before credits.
Record entry
4
General Journal
Clear entry
Debit
Credit
View general journal
>
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