Question

need cash over and short amount and cash amount.

Problem 8-3A Establishing, reimbursing, and increasing petty cash LO P2 Nakashima Gallery had the following petty cash transactions in February of the current year. Nakashimo uses the perpetual system to account for merchandise inventory Feb. 2 wrote a $350 check to establish a petty cash fund. 5 Purchased paper for the copier for $14.55 that is immediately used. 9 Paid $34.50 shipping charges (transportation-in) on merchandise purchased for resale, terus FOB shipping point. These costs are added to merchandise inventory. 12 paid $8.35 postage to deliver a contract to a client. 14 Reimbursed Adina Sharon, the manager, $72 for mileage on her car. 20 Purchased office paper for $68.77 that is immediately used. 23 Paid a courier $20 to deliver merchandise sold to a customer, terms FOB destination. 25 Paid $11.80 shipping charges (transportation-in) on merchandise purchased for resale, terms FOB shipping point. These costs are added to merchandise inventory. 27 Paid $57 for postage expenses. 28 The fund had $23.49 remaining in the petty cashbox. Sorted the petty cash receipts by accounts affected and exchanged them for a check to reimburse the fund for expenditures. 28 The petty cash fund amount is increased by $140 to a total of $490. Required: 1. Prepare the journal entry to establish the petty cash fund. 2. Prepare a petty cash payments report for February with these categories: delivery expense, mileage expense, postage expense, merchandise inventory (for transportation-in) and office supplies expense. 3. Prepare the journal entries for required 2 to both (a) reimburse and (b) increase the fund amount.

Answer 1

Greneral Date Jowrnal Debit Credit feb a Petty Cash $ 350 Cash 350 Lto necord petty cash) 2. NAKA SHIMA GALLERYy Petty Cash Payments Repont (or February Delivery expense Feb. 23 Delivery of customer's merchandie 20 Mileage expense felbi 4 Reimbuwrsement for mileage $72 Postage expense feb.12 Ex press delivery contract 8.35 Purchas ed poAtage ktamps Feb. 27 4 65.35 Merchandise fnvenctory (transporintin Feb. 9 Charges on purchases $ 34, S0 Changes on purchases Oftice supplies expense Febi5 Pur chased paper for coprer Purchased stationery Feb 25 11.80 $ 46.3 ¢ 14.55 febi 20 $68.77 # 83.32 Total $286.97

3. Gneneral JTounnal Date Debit Gredit feb 28 Mileage expense Merohardse fnvertony $ 72 $ 16.3 Delivery expense 0hice Aupples expense Postage expense 20 4 83.32 6 S.35 Cash and shart Over 39.54 Cash $326.51 (1o necord all expenses) Feb:98 Petty cash $140 Cash $140 to neiord petty cash) Caleulation: Feb. 2 Petty cash feb.38 Remaining pety cash Cash 23.49 3.50 1 326, 5I Cash All expenses Cash over and shart $ 326.51-72t46.3+ 20+83. 32 +65.3 $326. S1- 286 97 $39.54