H aig company maintains a petty cash fund for small expenditures. The following

Question

H

aig company maintains a petty cash fund for small expenditures. The following transactions occured over a 2-month period.

July 1- Established petty cash fund by writting a check on China Bank for $100

July 15-- Replenished the petty cash fund by writting a check for $96.90. On this date the fund consisted of $3.10 in cash and the following petty cash receipts freight-out $51.00, postage expense $20.50, entertainment expense $23.10 and miscellaneous expense $6.10

July 31-- Replenished the petty cash fund by writting a check for $95.90. At this date the fund consisted of $4.10 in cash and the following petty cash receipts freight-out $43.50, charitable contributions expense $20.00, postage expense $20.10 and miscellaneous expense $12.30

Aug 15- Replenished the petty cash fund by wirtting a check for $98.00. On this date the fund consisted of $2.00 in cahs and the following petty cash receipts freight-out $40.20 enterainment expense $21.00 postage expense $16.00 and miscellaneous expense $19.80

Aug 16- Increased the amount of petty cash fund to $150 by writting a check for $50

Aug 31st- Replenished the amount of the petty cash fun to $150 by writting a check for $50 fund consisted of $13 in cash and the following petty cash recipts: freight-out $74.00 entertainment expense $43.20 and postage expense $17.70

Instructions

What internal control featuers exist in a petty cash fund?

Explanation / Answer

The main internal control feature that exists is balancing of Inflow and Outflow to/from Petty cash

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