Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Learning Objective 4 P7-23A Accounting for petty cash transactions On June 1, Meadow Salad Dressings creates a petty cash fund with an imprest balance of

image text in transcribed
Learning Objective 4 P7-23A Accounting for petty cash transactions On June 1, Meadow Salad Dressings creates a petty cash fund with an imprest balance of $400. During June, Al Franklin, the fund custodian, signs the following petty cash tickets: 3. June 30, Cash CR $230 Petty Cash Ticket Number Item Amount 101 $ 15 10 102 103 104 Office supplies Cab fare for executive Delivery of package across town Business dinner Merchandise inventory 70 130 105 On June 30, prior to replenishment, the fund contains these tickets plus cash of $170. The accounts affected by petty cash payments are Office Supplies, Travel Expense, Delivery Expense, Entertainment Expense, and Merchandise Inventory. Requirements 1. Explain the characteristics and the internal control features of an imprest fund. 2. On June 30, how much cash should the petty cash fund hold before it is replenished? 3. Journalize all required entries to create the fund and replenish it. Include explanations. 4. Make the July 1 entry to increase the fund balance to $500. Include an explanation, and briefly describe what the custodian does

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions