Journals and petty cash payments report.
Inuke Gallery had the following petty cash transactions in February of the current year:
Feb. 2 Wrote a $300 check, cashed it, and gave the proceeds and the petty cashbox 10 Bo Brown, Establish, reimburse, and increase the petty cashier, petty cash 5 Purchased bond paper for the copier for $10.13 that is immediately used.
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9
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Paid $22.50 COD shipping charges on merchandise purchased for resale, terms FOB shipping point. Metro uses the perpetual system to account for merchandise inventory.
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12
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Paid $9.95 postage to express mail a contract 10 a client.
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14
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Reimbursed Alli Buck, the manager, $58 for business mileage on her car.
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20
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Purchased stationery for $77.76 that is immediately used.
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23
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Paid a courier $18 to deliver merchandise sold to a customer, terms FOB destination.
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25
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Paid $15.10 COD shipping charges on merchandise purchased for resale, terms FOB shipping point.
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27
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Paid $64 for postage expenses.
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28
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The fund had $21.23 remaining in the petty cash box, sorted the petty cash receipts by accounts affected and exchanged them for a check to reimburse the fund for expenditures.
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The fund amount is also increased to $400.
Required
1. Prepare the journal entry to establish the petty cash fund.
2. Prepare a petty cash payments report for February with these categories: delivery expense, mileage expense, postage expense, merchandise inventory (for transportation-in), and office supplies expense.
Sort the payments into the appropriate categories and total the expenditures in each category.
3. Prepare the journal entries for part 2 to both (a) reimburse and (b) increase the fund amount.