Using the above information, the journal entry to replenish the petty cash fund will include a credit of $94.00 to the account Cash: Checking Account. (This is the amount of the company check that will be cashed to get the cash in the petty cash fund back to the imprest general ledger amount of $100.)
What causes a petty cash account to be credited?
Notice that the petty cash account is debited or credited only when the fund is established or when the size of the fund is increased or decreased, not when the fund is replenished. This account is debited when there is a cash shortage and credited when there is a cash overage.
What is it called when petty cash on hand is more than the recorded amount *?
debit card. A petty cash on hand amount that is more than a recorded amount.
What is an endorsement on the back of a check consisting only of a signature?
Blank endorsement. An endorsement consisting only of the endorser’s signature. Canceled check. A check that has been paid by the bank.
Is cash short and over an asset?
This cash shortfall is recorded as a debit to the cash over and short account (which is an expense) and a credit to the petty cash or cash account (which is an asset reduction).
What is a signature or stamp on the back of a check transferring ownership called?
endorsement. a signature or stamp on the back of a check transferring ownership.
Which endorsement transfers ownership of the check?
Restrictive endorsement
Ch. 11 Vocabulary
| A | B |
|---|---|
| Restrictive endorsement | A check endorsement that transfers ownership to a specific owner and limits how the check may be handled. |
| Payee | The person or business to whom a check is written or a note is payable. |
| Drawer | The person who signs a check. |
| Drawee | The bank on which a check is written. |
How do you maintain petty cash float?
Seven simple steps to improve controls over petty cash
- Decide on a float and when to replenish.
- Segregation of roles.
- Define the expense limit and approval matrix.
- Use petty cash vouchers for all petty cash transactions.
- Demand receipts to back up the expenses claimed.
- Review and approval of petty cash reimbursement request.
What is the petty cash fund?
A petty cash fund is a small amount of cash kept on hand, in a locked drawer or box, to pay for minor expenses, such as office supplies or reimbursements.
How do you account for cash over and short?
Debit your cash short and over account in your journal entry by the amount of cash short. This represents an expense. Alternatively, credit your cash short and over account by the amount of cash over. This represents a revenue.
