Question

On April 11, Granger Sales decides to increase petty cash to $520. Journalize this event. If an amount box does not require an entry, leave it blank.

Answer 1

On April 11, Granger Sales increases petty cash to $520. The journal entry for this event is as follows:

`| Date | Account | Debit ($) | Credit ($) ||------------|---------------------|-----------|------------|| April 11 | Petty Cash | | $520 || | Cash | $520 | |`

Step-by-step explanation:

Granger Sales' decision to increase petty cash to $520 on April 11 necessitates a journal entry to accurately reflect this financial transaction. The entry involves debiting the Petty Cash account, representing the increase in funds, and crediting the Cash account, accounting for the reduction in cash due to the petty cash expansion.

In the journal entry, the debit side signifies the increase in the petty cash fund, while the credit side reflects the corresponding decrease in the overall cash balance. This approach ensures that the company's financial records accurately depict the adjustment made to the petty cash account on the specified date.

By executing this journal entry, Granger Sales maintains precise and organized financial records, reflecting the changes in petty cash. This transparent accounting practice is essential for tracking cash disbursements and maintaining an accurate representation of the company's financial position.