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Blossom Company designated Alexa Kidd as petty cash custodian and established a petty cash fund of $402. The fund is reimbursed when the cash in the fund is at $57. Petty cash receipts shows that funds were disbursed for $174 of supplies and $165 of freight charges on inventory purchases. Blossom uses a perpetual inventory system.
Problem 1: Blossom follows the practice of recording the purchase of supplies to the asset account. Prepare journal entries for the establishment of the fund and the reimbursement.
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