1. PETTY CASH PETTY CASH IS A SMALL SUM OF ACTUAL MONEY IN THE OFFICE TO MEET DAY TO DAY EXPENSES WITHOUT WRITING A CHECK GIVEN TO A TRUSTED INDIVIDUAL IN THE OFFICE IT IS INCLUDED IN CASH WHEN PRESENTED ON THE FINANCIAL STATEMENTS

2. JOURNAL ENTRY TO ESTABLISH PETTY CASH PETTY CASH $100 CASH $100 A CHECK IS WRITTEN OUT OF CASH AND THE CASH TRANSFERRED TO PETTY CASH

3. PETTY CASH AT ALL TIMES THE CASH IN THE PETTY CASH PLUS RECEIPTS SHOULD EQUAL THE ORIGNAL CASH BALANCE (BUT OFTEN DOES NOT)

4. TO REPLENISH PETTY CASH WRITE A CHECK FROM CASH TO BRING THE PETTY CASH BOX UP TO ITS ORIGINAL VALUE DEBIT ALL THE AMOUNTS FOR RECEIPTS IN THE PETTY CASH BOX DEBIT CASH SHORT AND OVER TO MAKE THE JOURNAL ENTRY BALANCE

5. EXAMPLE TO REPLENISH THE PETTY CASH BALANCE IS $100 AND IN THE BOX IS $60 OF CASH, A RECEIPT FOR $5 FOR STAMPS AND A RECEIPT FOR $10 WHICH AN EMPLOYEE BORROWED. STAMP EXPENSE $ 5 ACCOUNTS RECEIVABLE 10 CASH SHORT AND OVER 25 CASH $40

6. TO CHANGE FUND BALANCE TO CHANGE FROM $100 TO $170 PETTY CASH $70 CASH $70