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When is the petty cash account debited?
The petty cash account is debited when a company establishes or increases its petty cash fund. This entry reflects the outflow of cash from the main cash account to the petty cash account. Additionally, it may be debited when replenishing the petty cash fund, as it accounts for the expenses incurred that were paid from petty cash.
How do you establish the journal entry for petty cash?
[Debit] Petty Cash account [Credit] Cash account
Does the balance of the petty cash account increase when the petty cash fund is replenished?
No.
WHAT IS the correct entry to replenish a petty cash fund?
Dr Bank Account Cr Petty Cash Account
Issued a check to establish a petty cash fund of 1400?
Debit Petty cash account 1400 Credit Cash account 1400
When is the petty cash account debited?
The petty cash account is debited when a company establishes or increases its petty cash fund. This entry reflects the outflow of cash from the main cash account to the petty cash account. Additionally, it may be debited when replenishing the petty cash fund, as it accounts for the expenses incurred that were paid from petty cash.
Know the journal entry for reimbursing the petty cash account?
[Debit] Petty Cash account [Credit] Cash account
How do you establish the journal entry for petty cash?
[Debit] Petty Cash account [Credit] Cash account
Is petty cash a fixed cost?
No, petty cash is a control account not an expenditure account.
Does the balance of the petty cash account increase when the petty cash fund is replenished?
No.
WHAT IS the correct entry to replenish a petty cash fund?
Dr Bank Account Cr Petty Cash Account
What is the correct entry to replenish the petty cash fund?
Dr Bank Account Cr Petty Cash Account
Issued a check to establish a petty cash fund of 1400?
Debit Petty cash account 1400 Credit Cash account 1400
Is a petty cash account an asset with a normal credit balance?
Petty Cash is an asset account with a normal Debit balance.
Why is Cash rather than Petty Cash credited when a petty cash fund is replenished?
When a petty cash fund is replenished, the Cash account is credited instead of Petty Cash because the replenishment involves transferring funds from the main cash account to the petty cash fund. This reflects a decrease in the overall cash available in the main account. The Petty Cash account, on the other hand, remains unchanged since it is simply being topped up to maintain its established balance. Thus, the transaction more accurately represents the flow of cash between accounts.
Is petty cash account in balance sheet?
Petty cash is also Cash so like other cash account it is also shown in balance sheet.
Is the entry to establish a petty cash account a debit to petty cash and credit to cash?
yes. the entry should be: petty cash fund debit cash in bank credit
