Question

A petty cash fund of $100 is replenished when the fund contains $4 in cash and receipts for $93. The entry to replenish the fund would?

a. Credit cash over and short for $3.
b. Credit miscellaneous revenue for $3.
c. Debit cash over and short for $3.
d. Debit miscellaneous Expense for $3.

Answer 1

The correct entry to replenish the petty cash fund with a $3 shortage is to debit Cash Over and Short for $3.

Step-by-step explanation:

The entry to replenish the petty cash fund is calculated by taking the total amount of cash supposed to be in the fund ($100) and subtracting both the remaining cash ($4) and the sum of the receipts ($93). The difference is $3 ($100 - $93 - $4 = $3), which indicates a shortage in the expected amount. To account for this discrepancy, we would debit the Cash Over and Short account for the missing $3 and credit the Cash account when we replenish the fund. Therefore, the correct answer to this question among the provided options is c. Debit cash over and short for $3.