Exercise 6-10 (Algo) Petty cash fund accounting LO P2 Palmona Company establishes a $150 petty cash fund on January 1 . On January 8 , the fund shows $35 in cash along with receipts for the following expenditures: postage, \$50; transportation-in, \$12; delivery expenses, \$14; and miscellaneous expenses, \$39. Palmona uses the perpetual system in accounting for merchandise inventory. 1. Prepare the entry to establish the fund on January 1. 2. Prepare the entry to reimburse the fund on January 8 under two separate situations: a. To reimburse the fund. b. To reimburse the fund and increase it to $200. Hint. Make two entries. Exercise 6-10 (Algo) Petty cash fund accounting LO P2 Palmona Company establishes a $150 petty cash fund on January 1 . On January 8 , the fund shows $35 in cash along with receipts for the following expenditures: postage, \$50; transportation-in, \$12; delivery expenses, $14; and miscellaneous expenses, $39. Palmona uses the perpetual system in accounting for merchandise inventory. 1. Prepare the entry to establish the fund on January 1. 2. Prepare the entry to reimburse the fund on January 8 under two separate situations: a. To reimburse the fund. b. To reimburse the fund and increase it to $200. Hint. Make two entries. Journal entry worksheet Record the reimbursement of the petty cash fund. Note: Enter debits before credits. Exercise 6-10 (Algo) Petty cash fund accounting LO P2 Palmona Company establishes a $150 petty cash fund on January 1 . On January 8 , the fund shows $35 in cash along with receipts for the following expenditures: postage, $50; transportation-in, $12; delivery expenses, $14; and miscellaneous expenses, $39. Palmona uses the perpetual system in accounting for merchandise inventory. 1. Prepare the entry to establish the fund on January 1. 2. Prepare the entry to reimburse the fund on January 8 under two separate situations: a. To reimburse the fund. b. To reimburse the fund and increase it to $200. Hint. Make two entries. Journal entry worksheet Record the increase of the petty cash fund. Note: Enter debits before credits