Connect chapter 6 acct 211 - Connect - Financial Accounting...

Connect - Financial Accounting Chapter 6
1.
Waupaca Company establishes a $350 petty cash fund on September 9. On September 30, the fund
shows $104 in cash along with receipts for the following expenditures: transportation-in, $40; postage
expenses, $123; and miscellaneous expenses, $80. The petty cashier could not account for a $3
shortage in the fund. The company uses the perpetual system in accounting for merchandise inventory.
Prepare (1) the September 9 entry to establish the fund, (2) the September 30 entry to reimburse the
fund, and (3) an October 1 entry to increase the fund to $400.
Date General Journal Debit Credit
Sep 09 Petty cash 350
Cash 350
Sep 30 Merchandise inventory 40
Postage expense 123
Miscellaneous expenses 80
Cash short and over 3
Cash 246
Oct 01 Petty cash 50
Cash 50
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2.
Palmona Co. establishes a $200 petty cash fund on January 1. On January 8, the fund shows $38 in
cash along with receipts for the following expenditures: postage, $74; transportation-in, $29; delivery
expenses, $16; and miscellaneous expenses, $43. Palmona uses the perpetual system in accounting for
merchandise inventory.
Prepare journal entry to establish the fund on January 1, reimburse it on January 8, and reimburse the
fund and increase it to $450 on January 8, assuming no entry in part 2. ( Hint: Make two separate entries
for part 3.)
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3.
A table for a monthly bank reconciliation dated September 30 is given below. For each item 1 through 12, indicate whether the item
should be added to or deducted from the book or bank balance, or whether it should not appear on the reconciliation. (Select the
answers in the appropriate cells. Leave no cells blank. Be certain to select "NA" in fields which are not applicable.)

Bank
Balance
Book
Balance
Shown/Not Shown
on Reconciliation
1.
NSF check from customer is returned
on September 25 but not yet recorded
by this company.
NA
Deduct -
Cr.
Shown
2.
Interest earned on the September cash
balance in the bank.
NA Add - Dr. Shown
3.
Deposit made on September 5 and
processed by the bank on September
6.
NA NA Not Shown
4.
Checks written by another depositor but
charged against this company’s
account.
Add NA Shown
5. Bank service charge for September. NA
Deduct -
Cr.
Shown
6.
Checks outstanding on August 31 that
cleared the bank in September.
NA NA Not Shown
7.
Check written against the company’s
account and cleared by the bank;
erroneously not recorded by the
company’s recordkeeper.
NA
Deduct -
Cr.
Shown
8.
Principal and interest on a note
receivable to this company is collected
by the bank but not yet recorded by the
company.
NA Add - Dr. Shown
9.
Checks written and mailed to payees
on October 2.