Petty cash fund with a shortage
Check (2) Cr. Cash $234 and Dr. Cash $100
Gannon Company establishes a $400 petty cash fund on September 9. On September 30, the fund shows $166 in cash along with receipts for the following expenditures: transportation-in, $32; postage expenses, $113; and miscellaneous expenses, $87. The petty cashier could not account for a $2 shortage in the fund. Gannon uses the perpetual system in accounting for merchandise inventory. Prepare
(1) the September 9 entry to establish the fund and
(2) the September 30 entry to both reimburse the fund and reduce it to $300.