On April 30, Midwest Company established a petty cash fund of $1,000. On May 1, a disbursement of $355 was made from the fund for payment of delivery expense. What is the effect of the May 1 disbursement on the financial statements?
A. The disbursement has no effect on the financial statements
B. Petty cash increases and cash decreases by $355
C. Delivery expense increases and cash decreases by $355
D. Delivery expense increases and petty cash decreases by $355
Answer: A
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