Answered: Adjusted cash in bank balance, December… | bartleby

Financial Accounting

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter8: Sarbanes-oxley, Internal Control, And Cash

Section: Chapter Questions

Problem 18E

See similar textbooks

Related questions

Concept explainers

Question

The following information was obtained in connection with the audit of Kathereen Hyacinth Co’s cash account as of December 31,2021:

·       Cash balance per general ledger on December 31 was P37,500. The company recorded actual company collections amounting to P152,500 from its customers during December. Also in December, the company recorded bank service charges of P2,500, including November bank service charges of P1,500. The December bank statement showed total deposits credited by the bank of P145,000 and total checks paid amounting to P133,750 and bank service charges of P3,250.

·       The Outstanding checks on November 30 and December 31 were P16,250 and P12,500 respectively while deposit in transit on November 30 was P12,500

·       The cash receipts book of December is under-footed by P2,500.

·       The bank erroneously charged the company’s account for a P3,750 check for another company. This bank error was corrected on January 2022.

Adjusted cash in bank balance, December 31,2021 and November 30, 2021

P26,500 and P18,500

P37,750 and P14,750

P37,500 and P12,250

P26,750 and P17,450

Definition Definition Financial journal in which only cash-related transactions are recorded. Cash transactions are posted chronologically in the cash book, which is also called a subsidiary book. All the cash receipts are recorded on the debit side and all the cash payments are recorded on the credit side. An important point to remember is that the cash book never shows a credit balance; only a debit balance is shown in the cash book.

Expert Solution

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Blurred answer

Knowledge Booster

Bank reconciliation statement

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Complex Balance Sheet Presented below is the unaudited balance sheet as of December 31, 2019, prepared by Zeus Manufacturing Corporations bookkeeper. Your company has been engaged to perform an audit, during which you discover the following information: 1. Checks totaling 14,000 in payment of accounts payable were mailed on December 31, 2019, but were not recorded until 2020. Late in December 2019, the bank returned a customers 2,000 check marked NSF, but no entry was made. Cash includes 100,000 restricted for building purposes. 2. Included in accounts receivable is a 30,000 note due on December 31, 2022, from Zeuss president. 3. During 2019, Zeus purchased 500 shares of common stock of a major corporation that supplies Zeus with raw materials. Total cost of this stock was 51,300, and fair value on December 31, 2019, was 51,300. Zeus plans to hold these shares indefinitely. 4. Treasury stock was recorded at cost when Zeus purchased 200 of its own shares for 32 per share in May 2019. This amount is included in investments. 5. On December 31, 2019, Zeus borrowed 500,000 from a bank in exchange for a 10% note payable, manning December 31, 2024. Equal principal payments are due December 31 of each year beginning in 2020. This note is collateralized by a 250,000 tract of land acquired as a potential future building site, which is included in land. 6. The mortgage payable requires 50,000 principal payments, plus interest, at the end of each month. Payments were made on January 31 and February 28, 2020. The balance of this mortgage was due June 30, 2020. On March 1, 2020, prior to issuance of the audited financial statements, Zeus consummated a non-cancelable agreement with the lender to refinance this mortgage. The new terms require 100,000 annual principal payments, plus interest, on February 28 of each year, beginning in 2021. The final payment is due February 28, 2028. 7. The lawsuit liability will be paid in 2020. 8. Of the total deferred tax liability; 5,000 is considered a current liability. 9. The current income tax expense reported in Zeuss 2019 income statement was 61,200. 10. The company was authorized to issue 100,000 shares of 50 par value common stock.

Recommended textbooks for you

Financial Accounting

Financial Accounting

Accounting

ISBN:

9781305088436

Author:

Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:

Cengage Learning

Century 21 Accounting Multicolumn Journal

Century 21 Accounting Multicolumn Journal

Accounting

ISBN:

9781337679503

Author:

Gilbertson

Publisher:

Cengage

College Accounting (Book Only): A Career Approach

College Accounting (Book Only): A Career Approach

Accounting

ISBN:

9781337280570

Author:

Scott, Cathy J.

Publisher:

South-Western College Pub

Financial Accounting

Financial Accounting

Accounting

ISBN:

9781305088436

Author:

Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:

Cengage Learning

Century 21 Accounting Multicolumn Journal

Century 21 Accounting Multicolumn Journal

Accounting

ISBN:

9781337679503

Author:

Gilbertson

Publisher:

Cengage

College Accounting (Book Only): A Career Approach

College Accounting (Book Only): A Career Approach

Accounting

ISBN:

9781337280570

Author:

Scott, Cathy J.

Publisher:

South-Western College Pub

Survey of Accounting (Accounting I)

Survey of Accounting (Accounting I)

Accounting

ISBN:

9781305961883

Author:

Carl Warren

Publisher:

Cengage Learning

Financial And Managerial Accounting

Financial And Managerial Accounting

Accounting

ISBN:

9781337902663

Author:

WARREN, Carl S.

Publisher:

Cengage Learning,

Intermediate Accounting: Reporting And Analysis

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:

9781337788281

Author:

James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS