How much cash was in the fund before replenishment?

To determine the amount of cash in the petty cash fund before the replenishment, we need to subtract the accumulated expenses (receipts) from the original fund amount.

Original fund amount = $300

Accumulated expenses:

• Office supplies: $80
• Merchandise inventory: $160
• Miscellaneous expenses: $20

Total accumulated expenses = $80 + $160 + $20 = $260

Now, subtract the total accumulated expenses from the original fund amount:

Cash in the fund before replenishment = Original fund amount - Total accumulated expenses

Cash in the fund before replenishment = $300 - $260 = $40

So, the amount of cash in the petty cash fund before the replenishment is $40 (option c).