The Journal Entry to Open a New Petty Cash Fund

question 80

True/False

The journal entry to open a new petty cash fund includes a debit to the petty cash account and a credit to cash in bank.

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Definitions:

Explicit Costs

Direct, out-of-pocket payments for resources employed in the production of goods or services.

Implicit Costs

The opportunity costs of using resources owned by the firm for its own operations, without direct payment but with foregone opportunities.

Explicit Costs

Direct, out-of-pocket payments for wages, rent, and materials, among others, involved in the production of goods or services.

Opportunity Costs

The cost of forgoing the next best alternative when making a decision or choice.