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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

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BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

The cash register tape for June 30 showed cash receipts of $876, and the cash in the register drawer was $1,070. A change fund of $200 is maintained.

Prepare the journal entry for service fees and cash short and over at June 30.

To determine

Prepare journal entry to record service fees and cash short and over at June 30.

Explanation

Cash short and over: Cash short and over is an income statement (expense or revenue) account used to record shortage or overage of cash. The increase (overage) is credited and recorded as Revenue, and decrease (shortage) is debited and recorded as Expense.

Prepare journal entry to record service fees and cash short and over.

DateAccount titles and ExplanationDebitCredit
June 30Cash$870 
 Cash Short and Over$6 
      Service Fees $876
 (To record service fees and cash shortage)  

Table (1)

  • Cash is a current asset, and it is increased. Therefore, debit cash account for $870.
  • Cash short and over is a current asset, and it is increased. Therefore, debit cash short and over is a current asset for $6.
  • Service fees are a component of stockholders’ equity, and it is increases the expense account...

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