The petty cash fund account under the imprest fund system is debited A. only when the fund is created B. when the fund is created and every time it is replenished C. when the fund is created and when the size of the fund is increased D. when the fund is created and when the fund is decreased.

The petty cash fund account under the imprest fund system is debited A. only when the fund is created B. when the fund is created and every time it is replenished C. when the fund is created and when the size of the fund is increased D. when the fund is created and when the fund is decreased.

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter6: Bank Accounts, Cash Funds, And Internal Controls

Section: Chapter Questions

Problem 7QY

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Concept explainers

Cash Book

So, before coming to the topic of cash books, I will let you briefly explain about the cash so that you all can be familiar with the word cash. Cash comes under the category of the current asset which is used as a medium of exchange for all the financial transactions in the firm. Cash is something that is universally accepted as a mode of payment. So, now comes to the topic i.e., cash book.

Question

The petty cash fund account under the imprest fund system is debited

A. only when the fund is created

B. when the fund is created and every time it is replenished

C. when the fund is created and when the size of the fund is increased

D. when the fund is created and when the fund is decreased.

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1. Prepare a general journal entry to record establishing the petty cash fund. 2. Prepare a summary of petty cash payments. 3. Prepare the general journal entry to record the reimbursement and the decrease of the fund.
A special cash fund used to make small payments that occur frequently is called a(n) ____. a.operating expenses fund b.market fund c.change fund d.petty cash fund
The entry to replenish the petty cash fund debited Insurance Expense for postage. This would cause: A. Petty Cash to be overstated. B. Postage Expense to be overstated. C. Cash to be understated. D. Insurance Expense to be overstated.
Calculator Entries are made to the petty cash account when Oa. replenishing the petty cash fund Ob. Ob. recording shortages in the fund Oc. establishing the fund Od. making payments out of the fund
The entry to establish the Change Fund includes which of the following? Select one: Debit to Change Fund Credit to Petty Cash Debit to Petty Cash Credit to Change Fund
If the cash on hand is greater than the total of the change fund amount plus the cash sales per the cash register, then cash is over. cash is short. miscellaneous expense is recorded. Cash Over and Short is debited.
Which of the following serve as the basis for recording appropriate expenses each time the fund is replenished ? a . Request letter from cash custodian b . Checks issued to cash custodian • c . Receipts d . None of the given options
Which of the following is not true? a. The Petty Cash account is debited when the fund is replenished. b. The imprest petty cash system in effect adheres to the rule of disbursement by check. c. Entries are made to the Petty Cash account only to increase or decrease the size of the fund or to adjust the balance if not replenished at year-end. d. All of these answer choices are not true.
Which of the following is an electronic funds transfer system (EFTS) service? Group of answer choices a. Overdraft protection b. Automatic transfer program c. Preauthorized payments d. Stop payment e. Cashier's checks
After removing the Change Fund, a cash shortage exists if: a.the Petty Cash Fund is greater than the Change Fund. b.the Change Fund is greater than the Petty Cash Fund. c.the day's receipts are greater than the register reading. d.the day's receipts are less than the register reading.
Identify the two events from the following that cause a Petty Cash account to be credited in a journal entry. a. Fund amount is being reduced. c. Fund is being eliminated. b. Fund amount is being increased. d. Fund is being established.
What Petty Cash involves, choose the best answer: Select one: O a. Establishing the fund, making check payment and never replenish the fund b. Establishing the fund, making payment and replenish the fund c. Establishing the fund, making check payment and replenish the fund d. Borrow the fund, making payment and replenish the fund