Required information [Use the information provided below to answer the indicated questions.] On June 30, Nacho Mama's Cantina (located in Marco Island, FL) showed a debit balance of $12,679 in her cash account. In addition, Nacho Mama's bank statement dated June 30 shows that she has $13,349 on deposit.. a. As of June 30, Mama had a total of $3,050 in outstanding checks. b. Mama's June 30 bank statement lists a $65 bank service charge. c. Check No. 919, listed with the canceled checks, was correctly drawn for $589 in payment of a utility bill on June 15. Mama mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $598. d. Cash receipts of $2,324 from business conducted on June 30 were placed in the bank's night depository after banking hours, and were not recorded on the June 30 bank statement. Ce

Required information [Use the information provided below to answer the indicated questions.] On June 30, Nacho Mama's Cantina (located in Marco Island, FL) showed a debit balance of $12,679 in her cash account. In addition, Nacho Mama's bank statement dated June 30 shows that she has $13,349 on deposit.. a. As of June 30, Mama had a total of $3,050 in outstanding checks. b. Mama's June 30 bank statement lists a $65 bank service charge. c. Check No. 919, listed with the canceled checks, was correctly drawn for $589 in payment of a utility bill on June 15. Mama mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $598. d. Cash receipts of $2,324 from business conducted on June 30 were placed in the bank's night depository after banking hours, and were not recorded on the June 30 bank statement. Ce

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter6: Bank Accounts, Cash Funds, And Internal Controls

Section: Chapter Questions

Problem 5PA

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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.
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