Cameron Co. established a $164 petty cash fund on January 1, 2023. One week later, on January 8, the fund contained $31.91 in cash and receipts for these expenditures: postage, $45.92; transportation-in, $29.52; store supplies, $35.83; and a withdrawal of $20.82 by Jim Cameron, the owner. Cameron uses the perpetual method to account for merchandise inventory.

a. Prepare the journal entry to establish the fund on January 1.

b. Prepare a summary of the petty cash payments and record the entry to reimburse the fund on January 8. (Round your answers to 2 decimal places.)

Analysis Component: If the January 8 entry to reimburse the fund were not recorded and financial statements were prepared for the month of January, would profit be over- or understated? multiple choice Understated Overstated