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31 August, 22:25

Setterstrom Company established a petty cash fund on May 1, cashing a check for $100. The company reimbursed the fund on June 1 and July 1 with the following results.

June 1: Cash in fund $1.75. Receipts: delivery expense $31.25, postage expense $39.00, and miscellaneous expense $25.00.

July 1: Cash in fund $3.25. Receipts: delivery expense $21.00, entertainment expense $51.00, and miscellaneous expense $24.75.

On July 10, Setterstrom increased the fund from $100 to $130.

Required:

Prepare journal entries for Setterstrom Company.

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Answers (1)
  1. 1 September, 00:50
    0
    Following are the journal entries for Setterstrom Company;

    May 01

    Debit: Petty cash = $100.00

    Credit: Cash = $100.00

    Jun 01

    Debit: Delivery Expense = $31.25

    Debit: Postage Expense = $39.00

    Debit: Miscellaneous Expense = $25.00

    Debit: Cash over/short (Balance amount) = $3.00

    Credit: Petty Cash ($100 - $1.75) = $98.25

    Jul 01

    Debit: Delivery expense = $21.00

    Debit: Entertainment expense = $51.00

    Debit: Miscellaneous expense = $24.75

    Credit: Petty Cash ($100 - $3.25) = $96.75

    Jul 10

    Debit: Petty cash = $30.00

    Credit: Cash = $30.00
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