Question

When reconciling petty cash, you determine that the total withdrawals according the petty cash slips is $169.00. Since the fund started with $200.00, there should be $31.00 remaining in the petty cash box. When the cash is counted, there is only $28.00. How is the discrepancy entered in the journal?

Since there is a $3 overage of cash, each account the disbursements are charged to is debited to total $169.00, the Cash Over and Short account is credited $3, and the Cash account is credited $172.00 to replenish the fund.
Since there is a $3 overage of cash, each account the disbursements are charged to is debited to total $169.00, the Cash Over and Short account is debited $3, and the Cash account is credited $169.00 to replenish the fund.
Since there is a $3 shortage of cash, each account the disbursements are charged to is debited to total $169.00, the Cash Over and Short account is credited $3, and the Cash account is credited $172.00 to replenish the fund.
Since there is a $3 shortage of cash, each account the disbursements are charged to is debited to total $169.00, the Cash Over and Short account is debited $3, and the Cash account is credited $172.00 to replenish the fund.