Question

Prepare the journal entries to record the transactions related to the petty cash fund for May. (Enter answers to 2 decimal places, e.g. 125.62. If no entry is required, select "No Entry" for the account titles and enter O for the amounts, Credit account titles are automatically indented when the amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit 1. (To establish petty cash fund) 2. (To record expenditures from the fund)

1.Bill Jovi is reviewing the cash accounting for Windsor, Inc., a local mailing service. Jovi’s review will focus on the petty cash account and the bank reconciliation for the month ended May 31, 2017. He has collected the following information from Windsor’s bookkeeper for this task. Petty Cash 1. The petty cash fund was established on May 10, 2017, in the amount of $260.00. 2. Expenditures from the fund by the custodian as of May 31, 2017, were evidenced by approved receipts for the following: Postage expense $34.32 Mailing labels and other supplies 67.60 I.O.U. from employees 31.20 Shipping charges (to customer) 59.75 Newspaper advertising 23.71 Miscellaneous expense 15.96 On May 31, 2017, the petty cash fund was replenished and increased to $312.00; currency and coin in the fund at that time totaled $27.46. Bank Reconciliation THIRD NATIONAL BANK BANK STATEMENT Disbursements Receipts Balance Balance, May 1, 2017 $9,119.76 Deposits $29,120.00 Note payment direct from customer (interest of $31.20) 967.20 Checks cleared during May $32,396.00 Bank service charges 28.08 Balance, May 31, 2017 6,782.88 Windsor’s Cash Account Balance, May 1, 2017 $ 9,204.00 Deposits during May 2017 32,240.00 Checks written during May 2017 (33,108.40 ) Deposits in transit are determined to be $3,120.00, and checks outstanding at May 31 total $884.00. Cash on hand (besides petty cash) at May 31, 2017, is $255.84.

Answer 1

Date	Accounts Titles and Explanations	Debit (in $)	Credit (in $)
1	Petty Cash	$ 260
	Cash		$ 260
	(To record the Petty Cash Fund)
2	Postage Expense	$ 34.32
	Supplies Expense	$ 67.60
	Accounts Receivable - Loan from employees	$ 31.20
	Shipping charges	$ 59.75
	Advertising Expense	$ 23.71
	Miscellaneous Expense	$ 15.96
	Petty Cash		$ 232.54
	(To record the expenditures from the Fund)
3	Petty Cash ( $ 312 (-) $ 260)	$ 52
	Cash		$ 52
	(To replinish the petty Cash Fund)