Question

The ledger accounts given below, with an identification number for each, are used by RMS Company.

Instructions: Prepare appropriate entries for the month of March for each of the listed petty cash fund transactions by placing the appropriate identification number(s) in the debit and credit columns provided. Write "N/A" if no entry is appropriate.

1.   Cash                                                       6.    Supplies Expense

2.   Petty Cash                                              7.    Postage Expense

3.   Accounts Receivable                              8.    Freight-Out

4.   Supplies                                                  9.    Miscellaneous Expense

5.   Inventory                                               10.    Cash Over and Short

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                                                                                                           Account(s)          Account(s)

                  Entry Information                                                              Debited              Credited

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Mar.      1   Issued a check for $500 to establish a petty cash fund.

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Mar.      3   Disbursed $40 for pizza and drinks for staff working overtime.

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Mar.      5   Paid collect United Parcel Service bill for goods purchased for resale $20.

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(March 6 - 17 various other disbursements took place.)

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Mar.    18   Replenished the petty cash fund by writing a check for $345. On this date the fund consisted of $155 in cash plus the following petty cash receipts: Freight on inventory purchased $118, supplies $145, and miscellaneous expense $79.

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Mar.    21   A check was written for $200 to increase the stipulated amount of the fund.

Answer 1

Date Account Title and Description Debit(DR.) Credit(CR.)

March1 Petty Cash account    500

Cash account 500

(Being cash withdrawn from bank)

March 3 Supplies expenses account   40

Petty Cash account 40

(Being, Pizza ordered for overtime working staff)

March 5 Postage expenses account 20

Petty Cash acount    20

(being cash paid for receipt of parcel of goods)

March 18 Inventory account 118

Petty Cash account 118

(Being, Inventory purchased)

March 18 Petty cash account 345

Cash Account 345

(being, petty cash replenished from bank)

March 18 Supplies 145

Petty Cash account 145

(Being, Supplies purchased)

March 18 Miscellaneous expenses account 79

Petty Cash account 79

(Being cash paid for mis. expenses)

March 21 Petty cash account 200

Cash account 200

(Being, petty cash withdrawn from bank)