Financial Accounting

2033 WordsOct 22, 20139 Pages
Lecture 7 – Tutorial Questions Tutorial List: 7-1, 7-2, 7-3, 7-4, 7-5, 7-6, 7-7, 7-8, 7-9 7.1. Kristen Hope asks your help concerning an NSF check. Explain to Kristen (a) what an NSF check is, (b) how it is treated in a bank reconciliation, and (c) whether it will require an adjusting entry. 7.2. The bank portion of the bank reconciliation for Brasilia Company at October 31, 20X1 was as follows. BRASILIA COMPANY Bank Reconciliation October 31, 20X1 Cash balance per bank: R$6,000 Add: Deposits in Transit 842 6,842 Check Number Check Amount. 2451 R$700 2470…show more content…
Assume the current balance in Allowance for Doubtful Accounts is a CHF3,000 credit. (c) Of the above accounts, CHF1,600 is determined to be specifically uncollectible. Prepare the journal entry to write off the uncollectible account. (d) The company subsequently collects CHF700 on a specific account that had previously been determined to be uncollectible in (c). Prepare the journal entry(ies) necessary to restore the account and record the cash collection. (e) Explain how establishing an allowance account satisfies the expense recognition principle. 7.7. On December 1, 20X4, Westmoreland Company had the following account balances. Debit Credit Cash $ 18,200 Accumulated Depreciation— Notes Receivable 2,000 Equipment $ 3,000 Accounts Receivable 7,500 Accounts Payable 6,100 Inventory 16,000 Share Capital—Ordinary 50,000 Prepaid Insurance 1,600 Retained Earnings 14,200 Equipment 28,000 $ 73,300 $ 73,300 During December, the company completed the following transactions. Dec. 7 Received $3,600 cash from customers in payment of account (no discount allowed). 12 Purchased merchandise on account from Alice Co. $12,000, terms 1/10, n/30. 17 Sold merchandise on account $16,000, terms

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