Red Pine, Inc. established a $400 petty cash fund several months ago and repleni

Question

Red Pine, Inc. established a $400 petty cash fund several months ago and replenishes it at the end of each month. During the first two weeks of March, $185 was disbursed from the petty cash box for miscellaneous items. If a surprise count of the fund is made on March 15, the petty cash box should contain:

A) $215 cash and receipts for $185 in expenditures.
B) $215 cash left for March plus $400 cash for each month since creation of the petty cash fund.
C) $400 cash.
D) $215 cash.

Harvard Company purchased equipment having an invoice price of $11,500. The terms of sale were 2/10, n/30, and Harvard paid within the discount period. In addition, Harvard paid a $160 delivery charge, $185 installation charge, and $931 sales tax. The amount recorded as the cost of this equipment is:
A) $11,615.
B) $12,546.
C) $12,776.
D) $11,845.

Explanation / Answer

A) $215 cash and receipts for $185 in expenditures. 11,500*.98 + 160 + 185 + 931 = $12,546 B) $12,546.

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