Spencer Co. decides to establish a petty cash fund with a beginning balance of $200. The company decides that any purchase under $25 can be processed through petty cash instead of the voucher system. The journal entry to record establishing the account is:
A. Debit Cash $200 and credit Cash Over and Short $200.
B. Debit Petty Cash $200; credit Cash $175; and credit Cash Over and Short $25.
C. Debit Cash $200 and credit Petty Cash Over and Short $200.
D. Debit Petty Cash $200 and credit Cash $200.
E. Debit Cash $200 and credit Petty Cash $200.
Answer: D
You might also like to view...
Financial information exhibits the characteristic of consistency when
a. accounting procedures are adopted which smooth net income and make results consistent between years. b. extraordinary gains and losses are shown separately on the income statement. c. accounting entities give similar events the same accounting treatment each period. d. expenditures are reported as expenses and netted against revenue in the period in which they are paid.
A defendant who is indicted will next:
a. go before a grand jury. b. have a preliminary hearing. c. be arraigned. d. be prosecuted.
A "living will" is a will drafted and executed during a decedent's life
Indicate whether the statement is true or false
An indenture is an unsecured bond, and most of the bonds sold today in the United States are of this type
Indicate whether the statement is true or false.