nt: Your FSA ID E-T X cation.com/flow/connect.html ecure https:/ Help Save & Exl

Question

nt: Your FSA ID E-T X cation.com/flow/connect.html ecure https:/ Help Save & Exlt A company wants to decrease its $200.00 petty cash fund to $50.00. The entry to reduce the fund is: Multiple Choice Debit Petty Cash for $50.00, debit Cash Over and Short $181.00: credit Cash $200.00 Debit Cesh Over and Short for $8.50; credit Petty Cash $8.50. Debit to Cash $150.00; credit Petty Cash $150.00. Debit Petty Cash $131.00;credit Cash $131.00. Debit Miscellaneous Expenses $19.00, credit Cash $19.00.

Explanation / Answer

Solution: Answer is 3rd option Debit cash $150 ; Credit petty cash $150.00 Working Notes: When it Petty cash is created Account titles and Explanation Debit Credit Petty cash 200 cash 200 it can be reduced to of $50 by just reversing the above journal entry by excess amount that is ($200-$50= $150) Account titles and Explanation Debit Credit cash 150 Petty cash 150 Please feel free to ask if anything about above solution in comment section of the question.

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