Question

During March, Anderson Company engaged in the following transactions involving its petty cash fund:

March Transactions:
Mar.	1	Anderson Company established the petty cash fund by issuing a check for $1,800 to the fund custodian.
	4	The custodian paid $110 out of petty cash for freight charges on new equipment. This amount is properly classified as equipment.
	12	The custodian paid $200 out of petty cash for supplies. Anderson expenses supplies purchases as supplies expense.
	22	The custodian paid $40 out of petty cash for express mail services for reports sent to the Environmental Protection Agency. This is considered a miscellaneous expense.
	25	The custodian filed a claim for reimbursement of petty cash expenditures during the month totaling $350.
	31	Anderson issued a check for $350 to the custodian, replenishing the fund for expenditures during the month.

	Required:
	Prepare any journal entries required to record the petty cash account transactions that occurred during the month of March.

Answer 1

Solution:

Journal entries

Date	Particulars	Debit($)	Credit($)
Mar 1	Petty cash A/c Dr	$1,800
	To Cash A/c		$1,800
	Freight charges A/c Dr	$110
	Miscellaneous A/c Dr	$40
	Supply expenses A/c Dr	$200
	To Cash A/c		$350
	(The disbursement for the month of march)
Mar 4	Freight charges A/c Dr	$110
	To cash A/c		$110
Mar 12	Supply expenses A/c Dr	$200
	To Cash A/c		$200
Mar 22	Miscellaneous A/c Dr	$40
	To Cash A/c		$40
Mar 25	No entry required
Mar 31	Petty cash A/c Dr	$350
	To Cash A/c		$350