Question

At the time the $400 petty cash fund is being replenished, the company's accountant finds vouchers totaling $350 and petty cash of $50. The vouchers include: postage, $100; business lunches, $150; delivery fees, $75; and office supplies, $25. Which of the following is not recorded when replenishing the petty cash fund?
A. Debit postage expense, $100.
B. Debit office supplies, $25.
C. Credit cash, $350.
D. Debit petty cash, $350.

Answer 1

Answer:

D) Debit petty cash, $350.

Explanation:

You must journalize all the expenditures as follows:

Dr Postage Expense account 100

Dr Business Lunches Expense account 150

Dr Delivery Fees Expense account 75

Dr Office Supplies Expense account 25

        Cr Petty Cash account 350

Petty cash is not an expense, so it should not be debited.