Question 1

Section A

A business maintains a petty cash float of $200 using the imprest system. At the end of the month, the petty cash box contains $45 in cash and vouchers for expenses totaling $150. A $5 note is missing and unaccounted for. How much cash must be withdrawn from the bank to restore the imprest amount?

Accepted Answer

The imprest system requires restoring the cash balance to the fixed float amount. Float = $200. Current cash = $45. Amount needed = $200 - $45 = $155. (The missing $5 is part of the replenishment, recorded as a cash shortage expense).

Question 2

What mistakes do candidates make on this ACCA question?

Accepted Answer

Only withdrawing the amount of the vouchers ($150) and ignoring the shortage.

How to approach this question

Full Answer

Common mistakes

Practice the full ACCA FA — Financial Accounting Practice Exam 6

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