Waupaca Company establishes a $350 petty cash fund on September 9. On September 30, the fund shows $144 in cash along with receipts for the following expenditures: transportation costs of merchandise purchased, $42; postage expenses, $50; and miscellaneous expenses, $102. The petty cashier could not account for a $12 shortage in the fund. The company uses the perpetual system in accounting for merchandise inventory. Prepare: a. the September 9 entry to establish the fund.
b. the September 30 entry to reimburse the fund
c. An October 1 entry to increase the fund to $395.

Solution :

Date             Account                                            Debit            Credit

Sept 9          Petty cash                                          $ 350

                    Cash                                                                         $ 350

Sept 30        merchandise purchased                     $ 42

                    postage expenses                              $ 50

                   miscellaneous expenses                    $ 102

                   Cash shortage                                    $ 12

                  Cash (350-42-50-102)=156-144=12                           $ 206

Oct 1           Petty cash                                              45

                   Cash (395-350)                                                          $ 45

i might look it up later.