EcoMart establishes a $$1,050$ petty cash fund on May $2.$ On May $30,$ the fund shows $$326$ in cash along with receipts for the following expenditures: transportation$-$in$,$ $$120$; postage expenses, $$369$; and miscellaneous expenses, $$240.$ The petty cashier could not account for a $$5$ overage in the fund. The company uses the perpetual system in accounting for merchandise inventory.

Prepare the

$(1)$ May $2$ entry to establish the fund,

$(2)$ May $30$ entry to reimburse the fund $[$Hint$.$ Credit Cash Over and Short for $$5$ and credit Cash for $$724],$ and

$(3)$ June $1$ entry to increase the fund to $$1,200.$

Journal entry worksheet

$1$

$2$

$3$

Record the May $2$ entry to establish the fund.

Note: Enter debits before credits.

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