A trader maintains a petty cash book using the imprest system. The imprest amount is $\$ 120$. The petty cash transactions during the month of June were: | | $\$$ | | :--- | :---: | | receipt from a customer | 21 | | payments | | | stationery | 25 | | postage | 10 | | cleaning | 20 | | payment to a supplier | 40 | How much was given to the petty cashier on 1 July to restore the imprest?
Explanation
The correct option is D because the imprest amount is $120 and the total of the petty cash transactions is $120. The petty cashier has spent $21 + $25 + $10 + $20 + $40 = $116. To restore the imprest, the cashier needs $120 - $116 = $4. However, the question asks for the amount given to the petty cashier on 1 July to restore the imprest, which is the same as the imprest amount.
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