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Establishing and replenishing a petty cash fund; setting up an auxiliary petty cash recor

Establishing and replenishing a petty cash fund; setting up an auxiliary petty cash recor

 Establishing and replenishing a petty cash fund; setting up an auxiliary petty cash record.

1) What type of an account is the petty cash fund?

A) Revenue

B) Expense

C) Asset

D) Liability

2) A petty cash fund is set up

A) to pay for large expenses.

B) to pay for small expenses.

C) for the owner to withdraw money for personal use conveniently.

D) None of these answers are correct.

3) The credit recorded in the journal to replenish the petty cash fund is to

A) Cash.

B) Petty Cash.

C) Accounts Receivable.

D) Accounts Payable.

4) The debit recorded in the journal to establish the petty cash fund is to

A) Cash.

B) Petty Cash.

C) Accounts Receivable.

D) Accounts Payable.

5) Which of the following accounts would most likely be debited in the replenishment of petty cash?

A) Cash

B) Petty Cash

C) Postage Expense

D) Withdrawals

6) The credit recorded in the journal entry to establish the petty cash fund is to

A) Cash.

B) Petty Cash.

C) Postage Expense.

D) Withdrawals.

7) A $50 petty cash fund has cash of $20 and valid receipts for $30. The entry to replenish the fund would include a

A) credit to Cash for $30.

B) debit to Cash for $30.

C) credit to Petty Cash for $30.

D) debit to Petty Cash for $30.

8) The entry establishing a $150 petty cash fund would include a

A) debit to Cash for $150.

B) credit to Petty Cash for $150.

C) debit to Petty Cash for $150.

D) debit to Miscellaneous Expense for $150.

9) The Petty Cash account is debited when

A) the account is being replenished.

B) the account balance is being decreased.

C) the account balance is being increased.

D) the custodian pays for postage from petty cash.

10) The entry to replenish the petty cash fund debited Insurance Expense for postage. This would cause

A) Petty Cash to be overstated.

B) Petty Cash to be understated.

C) Postage Expense to be overstated.

D) Insurance Expense to be overstated.

Tripti 06-Dec-2019

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