McIntyre Company adheres to a policy of depositing all cash receipts in a bank account and making all payments by check. The cash account asof December 31 has a credit balance of $1,850, and there is no undeposited cash on hand.(a) Assuming that no errors occurred during journalizingor posting, what caused this unusual balance?(b) Is the $1,850 credit balance in the cashaccount an asset, a liability, owner’s equity, a revenue,or an expense?
McIntyre Company adheres to a policy of depositing all cash receipts in a bank account and making all payments by check. The cash account asof December 31 has a credit balance of $1,850, and there is no undeposited cash on hand.(a) Assuming that no errors occurred during journalizingor posting, what caused this unusual balance?(b) Is the $1,850 credit balance in the cashaccount an asset, a liability, owner’s equity, a revenue,or an expense?
Chapter8: Budgets And Bank Reconciliations
Section: Chapter Questions
Problem 2.10C
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McIntyre Company adheres to a policy of depositing all cash receipts in a bank account and making all payments by check. The cash account as
of December 31 has a credit balance of $1,850, and there is no undeposited cash on hand.
(a) Assuming that no errors occurred during journalizing
or posting, what caused this unusual balance?
(b) Is the $1,850 credit balance in the cash
account an asset, a liability, owner’s equity, a revenue,
or an expense?
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