Answer:
October 1
Dr. Petty Cash $146
Cr. Cash $146
October 31
Dr. Supplies $24.77
Dr. Miscellaneous items $15.07
Dr. Postage $38.37
Dr. Freight-Out $5.47
Dr. Cash Shortage $1.29
Cr. Cash (146-59-2.03) $84.97
Tot reimburse Petty cash Expense
Dr. Petty Cash $50
Cr. Cash at bank $50
(196-146 = 50)
Explanation:
A petty cash is a small amount of money disbursed by an organisation for expenditures. This expenditures are usually day to day expenses such as postages, stationaries, office supplies and so on. From time to time, there may be cash shortages or the cash may be over for various reasons.
Supplies, Miscellaneous items, Postage, and Freight are all expenses account due to their debit nature it is debited to record all these expenses and Cash net of petty cash balance and actual cash available is credited to decrease the balance of the cash used for expenses. Ne of these entries is cash excess or shortage.
Cash issued for petty cash is recorded as debit in petty cash account and credit the cash at bank to record the effect of this transfer.
