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    Petty Cash

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    E7-16

    Mora Company maintains a petty cash fund for small expenditures. These transactions occurred during the month of August.

    Aug 1 Established the petty cash fund by writing a check on Central Bank for $200.

    Aug 15 Replenished the petty cash fund by writing a check for 170. ON THIS DATE, THE FUND CONSISTED OF 30 IN CASH AND THESE PETTY cash receipts: freight out 74.40, entertainment expense 36, postage expense 33.70 and miscellaneous expense 27.50.

    Aug 16 Increased the amount of the petty cash fund to $400 by writing a check for 200.

    Aug 31 Replenished the petty cash fund by writing a check for $283. On this date, the fund consisted of 117 in cash and these petty cash receipts: postage expense 145, entertainment expense 90.60, and freight out 46.40.

    A) Journalize the petty cash transactions.
    B) Post to the petty cash account.
    C) What internal control features exist in a petty cash fund?

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    Solution Summary

    The solution explains the journal entries and internal control relating to petty cash fund

    $2.19

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