{"id":254979,"date":"2025-07-12T18:04:43","date_gmt":"2025-07-12T18:04:43","guid":{"rendered":"https:\/\/learnexams.com\/blog\/?p=254979"},"modified":"2025-07-12T18:04:45","modified_gmt":"2025-07-12T18:04:45","slug":"a-300-petty-cash-fund-has-cash-of-39-and-receipts-of-255","status":"publish","type":"post","link":"https:\/\/www.learnexams.com\/blog\/2025\/07\/12\/a-300-petty-cash-fund-has-cash-of-39-and-receipts-of-255\/","title":{"rendered":"A $300 petty cash fund has cash of $39 and receipts of $255"},"content":{"rendered":"\n<p>A $300 petty cash fund has cash of $39 and receipts of $255. The journal entry to replenish the fund would include a <\/p>\n\n\n\n<p> options: <\/p>\n\n\n\n<p>A) credit to Cash for $261. <\/p>\n\n\n\n<p>B) credit to Petty Cash for $255. <\/p>\n\n\n\n<p>C) debit to Petty Cash for $261. <\/p>\n\n\n\n<p>D) debit to Cash for $255.<\/p>\n\n\n\n<p><strong><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-ast-global-color-6-color\">The correct answer and explanation is:<\/mark><\/strong><\/p>\n\n\n\n<p>The correct answer is <strong>D) debit to Cash for $255<\/strong>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Explanation:<\/h3>\n\n\n\n<p>A petty cash fund is a small amount of money kept on hand for minor expenses that are typically not paid by check. In the case of this question, the petty cash fund initially had $300. After some time, there is $39 in cash and $255 in receipts, meaning that the fund has been used to pay for expenses.<\/p>\n\n\n\n<p>To replenish the fund, the company needs to restore the cash balance to the original amount of $300. The difference between the original balance and the remaining cash is:<\/p>\n\n\n\n<p><strong>$300 (original balance) &#8211; $39 (remaining cash) = $261.<\/strong><\/p>\n\n\n\n<p>However, there are receipts for expenses amounting to $255. The journal entry to replenish the petty cash fund will include:<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Debiting the relevant expense accounts (such as Office Supplies, Travel, or Meals) for the total amount of the receipts.<\/strong> This ensures that the expenses are recorded in the proper accounts.<\/li>\n\n\n\n<li><strong>Crediting Cash for $261,<\/strong> which represents the amount that needs to be taken from the main cash account to restore the petty cash fund back to its original amount of $300.<\/li>\n<\/ol>\n\n\n\n<p>Therefore, the cash account is reduced by $261 (since the petty cash fund is being replenished), and the various expenses are debited based on the receipts submitted. The debit to Cash for $255 reflects the need to top up the petty cash fund by this amount. The remaining $6 (which accounts for the discrepancy between the total receipts and the amount required to restore the petty cash fund) is usually adjusted as part of the petty cash handling process.<\/p>\n\n\n\n<p>Thus, the correct entry is a <strong>debit to Cash for $255<\/strong>, which ensures the proper replenishment of the fund.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A $300 petty cash fund has cash of $39 and receipts of $255. The journal entry to replenish the fund would include a options: A) credit to Cash for $261. B) credit to Petty Cash for $255. C) debit to Petty Cash for $261. D) debit to Cash for $255. The correct answer and explanation [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-254979","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/254979","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=254979"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/254979\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=254979"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=254979"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=254979"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}