If a petty cash fund is established in the amount of $200, and contains $118 in cash and $85 in receipts for disbursements when it is replenished, the journal entry to record replenishment should include credits to which of the following accounts?
A) Petty Cash, $85.
B) Petty Cash, $82.
C) Cash, $82; Cash Over and Short, $3.
D) Cash, $82.

Question

Quizplus · Accepted Answer

The total amount of cash and receipts in the petty cash fund is $118 + $85 = $203, which means $3 is over and short. The journal entry to replenish petty cash should include a debit to the appropriate expense accounts and credits to Cash and Cash Over and Short. Choice C is the only option that includes both Cash and Cash Over and Short.

If a Petty Cash Fund Is Established in the Amount