Name:Jessa Cardenas Section: 11004 Date: 01/27/21

Score:

Discussion Questions on Cash and Cash Equivalents

ADAPTED: Conrado T. Valix, Jose F. Peralta, & Christian Aris M. Valix, Intermediate Accounting,
Volume 1, 2020 Edition

Zealous Company established a petty cash fund.

1. Established a petty cash fund of P10,000 on January 2.

2. Petty cash expenses – January 2-31 are:
Postage 1,500
Supplies 5,500
Transportation 1,200
Miscellaneous expense 800
3. The fund is replenished on February 1 and increased by P5,000.

Required: Prepare journal entries to record the transactions under the fluctuating fund system and
imprest fund system.

Imprest fund system

1. Petty cash fund 10,000

Cash in Bank 10,000

2. No entry

3. Postage 1,500
Supplies 5,500
Transportation 1,200
Miscellaneous expense 800
Petty cash fund 5,000
Cash in Bank 14,000

Flunctuating fund system

1. Petty cash fund 10,000

Cash in Bank 10,000

2. Postage 1,500
Supplies 5,500
Transportation 1,200
Miscellaneous expense 800
 Petty cash fund 9,000
3. Petty cash fund 14,000
Cash in Bank 14,000