Problem 7

You are making an audit of the Darwin Corporation for the past calendar year. The balance of the Petty account at December 31, 2006 was PI,300. Your count of the imprest cash count made at 8:30 am on January 3, 2007, in the presence of the petty cash custodian, revealed:

Currency and coins Checks:		571.38
12/28/06 Macky, vice-president	PNB	360.00
12/29/06 Andy, employee	DBP	60.00
12/31/06 Bobot, customer	RCBC	153.80
01/02/07 Neil, customer	PNB	121.36
01/10/07 Jeff, employee (check received Dec. 29)	PNB	60.00

(These checks were all considered good when deposited after dates shown on the checks. The first four checks were actually deposited Jan. 3; the last check was deposited Jan. 11; all five checks proved to be good.)

Vouchers:

Dec. 11 Dec. 28 Dec. 29 Dec. 31 Jan. 2

#261 Richard, shipping clerk - temporary advance for the use of the receiving department. Your count of Mr. Richard's fund revealed: currency - P28.80; merchandise freight bills, P31.20. P 60.00 # 301 Postage 12.00 # 302 Freight bill on m erchandise purchases 47.30 # 305 Freight bill on office supplies 88.93 # 500 Freight bill on merchandise purchases 29.36

IOU Dec. 21 Mabel, employee 36.00

Sales Invoices (for cash sales, collections handled by the petty cashier):

Invoice # 315 Dec. 30 P 120.00 328 Dec. 31 153.80

334 Jan. 2 121.36

(As a general rule, the petty cashier endeavored to turn over the proceeds of cash sales to the general cashier on the 10 th , 20th and last days of each month. Proceeds on these sales were recorded and deposited by the general cashier.)

Postage Stamps:

Three one-peso stamps. The petty cashier handled postage stamps. These stamps represent the unused stamps purchased on Voucher # 301.

Questions

1. The petty cash fund shortage at December 31, 2006 is:

a. P 216.39 b. p 123.83 c. P 98.03 d. P 95.03

2. The adjusted petty cash fund balance of DARWIN CORPORATION at December 31, 2006 is:

   1. P 900.74 b. P960.74 c. P 1,174.54d. P 1,234.54

3. DARWIN CORPORATION'S operating expenses found in the petty cash fund at December 31, 2006 is:

   1. P 208.23 b. P 205.75 c. P 174.03 d. P97.93

4. The Cash account (excluding PCF) of DARWIN CORPORATION is understated at December 31, 2006 by:

   1. P395.16 b. P273.80 c.P153.80 d. P120.00