The company decides that the May 16 increase in the fund was too large. It reduc
ID: 2567640 • Letter: T
Question
The company decides that the May 16 increase in the fund was too large. It reduces the fund by $120, leaving a total of $480.
Journal entry worksheet
Prepare the journal entries for each of the petty cash transactions.
No
Date
Account Title
Debit
Credit
1
May 01
Petty cash
450
1
Cash
450
2
May 15
Janitorial expenses
160
2
Miscellaneous expenses
120
2
Postage expenses
80
2
Advertising expense
41
2
Cash
387
2
Cash over and short
14
3
May 16
Petty cash
150
3
Cash
150
4
May 31
Postage expenses
205
4
Mileage expense
103
4
Delivery expense
34
4
Cash
360
4
Cash over and short
18
5
May 31
Cash
120
5
Petty cash
120
See how your entries updated the account balances.
Dates:
May 01 to: May 31
General Ledger Account
Cash
No.
Date
Debit
Credit
Balance
Apr 30
4,640
1
May 01
450
4,190
2
May 15
387
3,803
3
May 16
150
3,653
4
May 31
360
3,293
5
May 31
120
3,413
Petty cash
No.
Date
Debit
Credit
Balance
Apr 30
0
1
May 01
450
450
3
May 16
150
600
5
May 31
120
480
Inventory
No.
Date
Debit
Credit
Balance
Apr 30
5,200
Clark, Capital
No.
Date
Debit
Credit
Balance
Apr 30
3,100
Service revenue
No.
Date
Debit
Credit
Balance
Apr 30
13,000
Janitorial expenses
No.
Date
Debit
Credit
Balance
Apr 30
550
2
May 15
160
710
Insurance expense
No.
Date
Debit
Credit
Balance
Apr 30
1,380
Rent expense
No.
Date
Debit
Credit
Balance
Apr 30
2,640
Postage expenses
No.
Date
Debit
Credit
Balance
Apr 30
250
2
May 15
80
330
4
May 31
205
535
Miscellaneous expenses
No.
Date
Debit
Credit
Balance
Apr 30
800
2
May 15
120
920
Mileage expense
No.
Date
Debit
Credit
Balance
Apr 30
90
4
May 31
103
193
Advertising expense
No.
Date
Debit
Credit
Balance
Apr 30
420
2
May 15
41
461
Cash over and short
No.
Date
Debit
Credit
Balance
Apr 30
0
2
May 15
14
(14)
4
May 31
18
(32)
Delivery expense
No.
Date
Debit
Credit
Balance
Apr 30
130
4
May 31
34
164
See how your entries updated the trial balance.
Dates:
May 01 to: May 31
Clark Company
Trial Balance
May 31, 2017
Account Title
Debit
Credit
Cash
3,413
Petty cash
480
Inventory
5,200
Clark, Capital
3,100
Service revenue
13,000
Janitorial expenses
710
Insurance expense
1,380
Rent expense
2,640
Postage expenses
535
Miscellaneous expenses
920
Mileage expense
193
Advertising expense
461
Cash over and short
32
Delivery expense
164
Total
16,096
16,132
Indicate the impact each transaction had on net income. Enter decreases to net income as negative values.
Dates:
May 01 to: May 31
Transaction
Impact transaction has on income:
Amount of increase (decrease)
May 1) Prepared a company check for $450 to establish the petty cash fund.
May 15) Prepared a company check to replenish the fund for the following expenditures made since May1: $160 for janitorial services, $120 for miscellaneous expenses, postage expenses of $80, $41 for an advertisement. Counted $63 remaining in the petty cash box.
May 16 Prepared a company check for $150 to increase the fund to $600.
May 31 The petty cashier reports that $240 cash remains in the fund. A company check is drawn to replenish the fund for the following expenditures made since May 15: postage expenses of $205, business mileage, $103, $34 to deliver merchandise to a customer, terms FOB destination.
May 31 The company decides that the May 16 increase in the fund was too large. It reduces the fund by $120, leaving a total of $480.
In total, net income increased (decreased) by:
$0
May 1 Prepared a company check for $450 to establish the petty cash fund. May 15 Prepared a company check to replenish the fund for the following expenditures made since May 1. a. Paid $160 for janitorial services. b. Paid $120 for miscellaneous expenses. c. Paid postage expenses of $80. d. Paid $41 to The County Gazette (the local newspaper) for an advertisement. e. Counted $63 remaining in the petty cash box. May 16 Prepared a company check for $150 to increase the fund to $600. May 31 The petty cashier reports that $240 cash remains in the fund. A company check is drawn to replenish the fund for the following expenditures made since May 15. f. Paid postage expenses of $205. g. Reimbursed the office manager for business mileage, $103. h. Paid $34 to deliver merchandise to a customer, terms FOB destination. May 31The company decides that the May 16 increase in the fund was too large. It reduces the fund by $120, leaving a total of $480.
Journal entry worksheet
Prepare the journal entries for each of the petty cash transactions.
No
Date
Account Title
Debit
Credit
1
May 01
Petty cash
450
1
Cash
450
2
May 15
Janitorial expenses
160
2
Miscellaneous expenses
120
2
Postage expenses
80
2
Advertising expense
41
2
Cash
387
2
Cash over and short
14
3
May 16
Petty cash
150
3
Cash
150
4
May 31
Postage expenses
205
4
Mileage expense
103
4
Delivery expense
34
4
Cash
360
4
Cash over and short
18
5
May 31
Cash
120
5
Petty cash
120
Explanation / Answer
The entry dated May.31 is wrong.
the entry should be
This will bring the balance in cash over and short to Dr. $4 ,by which the trial balace will match.
Impact of the transaction
on income
Amount of
Increase / (Decrease)
Date Account Debit Credit May.31, 2017 Postage expense 205 Mileage expense 103 Delvery expense 34 Cash over and short 18 Cash 360Related Questions
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