Financial Accounting, Student Value Edition (4th Edition)
4th Edition
ISBN: 9780134114811
Author: Robert Kemp, Jeffrey Waybright
Publisher: PEARSON
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Chapter 7, Problem 49BP
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Prepare the bank reconciliation for incorporation PI at May 31.
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Learning Task 5 Directions: Using the information below, prepare a Bank Reconciliation Statement.Bank reconciliation problem:• The bank statement for Juan Company shows a balance per bank of P15,907.45 on April 30,2015.• On this date the balance of cash per books is P11,589.45.• Additional information are provided below: Deposits in transit: April 30 deposit (received by the bank on May 1) P2,201.40 Outstanding checks: No. 453-P3,000.00 No. 457-P1,401.30 No. 460-P1,502.70• Errors: Juan wrote check no. 443 for P1,226.00 and the bank correctly paid that amount. However, he recorded the check as P1,262.00.• Bank memoranda: Debit– NSF check from Pedro P425.60 Debit– Charge for printing company checks P30.00 Credit – Collection of note receivable for P1,000 plus interest earned of P50, less bank collection fee of P15.00.Hint: Bank Debit Memo are deductions made by the bank to the account of the depositor. Bank Credit Memo are additions made by the bank to the account of the deposito
The following is a comprehensive problem which encompasses all of the elements learned in previous chapters. You can refer to the objectives for each chapter covered as a review of the concepts.
Note: You must complete part 1 before completing part 2.
Based on the following data, prepare a bank reconciliation for December of the current year:
a. Balance according to the bank statement at December 31, $283,000.b. Balance according to the ledger at December 31, $245,410.c. Checks outstanding at December 31, $68,540.d. Deposit in transit, not recorded by bank, $29,500.e. Bank debit memo for service charges, $750.f. A check for $12,700 in payment of an invoice was incorrectly recorded in the accounts as $12,000.
The folowing Information was gathered by Superior Landscaping in order to prepare its Bank Reconciliation at the end of October:
Balance in Cash Ledger account at end of Oct 31 $4,450
Balance of Cash in Bank Statement at end of Oct 31 3,900
Electornic Funds Transfer deposited into your Bank account late Oct 31 600
Outstanding Cheques at end of Oct 31 1,200
Deposits in Transit 2,000
NSF cheque received from a customer 350
Prepare the October 31st Bank Reconciliation
Chapter 7 Solutions
Financial Accounting, Student Value Edition (4th Edition)
Ch. 7.A - Prob. 1SECh. 7.A - Prob. 2SECh. 7.A - Prob. 3AECh. 7.A - Prob. 4AECh. 7.A - Prob. 5BECh. 7.A - Prob. 6BECh. 7.A - Prob. 7APCh. 7.A - Prob. 8APCh. 7 - Which duties should be segregated in the...Ch. 7 - Prob. 2DQ
Ch. 7 - Prob. 3DQCh. 7 - Why does the allowance method of accounting for...Ch. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - How would the net realizable value of Accounts...Ch. 7 - Prob. 9DQCh. 7 - Prob. 10DQCh. 7 - Prob. 1SCCh. 7 - Prob. 2SCCh. 7 - Prob. 3SCCh. 7 - Prob. 4SCCh. 7 - Prob. 5SCCh. 7 - Prob. 6SCCh. 7 - Prob. 7SCCh. 7 - Prob. 8SCCh. 7 - Prob. 9SCCh. 7 - Prob. 10SCCh. 7 - Prob. 11SCCh. 7 - Prob. 12SCCh. 7 - Prob. 1SECh. 7 - Prob. 2SECh. 7 - Prob. 3SECh. 7 - Prob. 4SECh. 7 - Prob. 5SECh. 7 - Prob. 6SECh. 7 - Prob. 7SECh. 7 - Prob. 8SECh. 7 - Prob. 9SECh. 7 - Prob. 10SECh. 7 - Prob. 11SECh. 7 - Prob. 12SECh. 7 - Prob. 13SECh. 7 - Prob. 14SECh. 7 - Prob. 15SECh. 7 - Quick ratio (Learning Objective 7) 510 min....Ch. 7 - Prob. 17SECh. 7 - Prob. 18AECh. 7 - Prob. 19AECh. 7 - Prob. 20AECh. 7 - Prob. 21AECh. 7 - Prob. 22AECh. 7 - Prob. 23AECh. 7 - Prob. 24AECh. 7 - Prob. 25AECh. 7 - Prob. 26AECh. 7 - Prob. 27AECh. 7 - Quick ratio and current ratio (Learning Objective...Ch. 7 - Prob. 29AECh. 7 - Prob. 30BECh. 7 - Prob. 31BECh. 7 - Prob. 32BECh. 7 - Prob. 33BECh. 7 - Prob. 34BECh. 7 - Prob. 35BECh. 7 - Prob. 36BECh. 7 - Prob. 37BECh. 7 - Prob. 38BECh. 7 - Prob. 39BECh. 7 - Quick ratio and current ratio (Learning Objective...Ch. 7 - Prob. 41BECh. 7 - Prob. 42APCh. 7 - Prob. 43APCh. 7 - Prob. 44APCh. 7 - Prob. 45APCh. 7 - Prob. 46APCh. 7 - Prob. 47APCh. 7 - Prob. 48APCh. 7 - Prob. 49BPCh. 7 - Prob. 50BPCh. 7 - Prob. 51BPCh. 7 - Prob. 52BPCh. 7 - Prob. 53BPCh. 7 - Prob. 54BPCh. 7 - Prob. 55BPCh. 7 - Continuing Exercise In this exercise, we continue...Ch. 7 - Prob. 1CPCh. 7 - Prob. 1CFSAPCh. 7 - Prob. 1EIACh. 7 - Prob. 2EIACh. 7 - Prob. 1FACh. 7 - Prob. 1IACh. 7 - Prob. 1SBACh. 7 - Prob. 1WC
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- Help would be appreciated 2. On December 31st, Bub's gym received a bank statement for December. b. Prepare a bank reconciliation. Use the following information from the bank statement and business records. Bank balance $1685.00 Bank service charge $25.00 Outstanding Deposit, Dec 30 $450.00 Outstanding checks, No. 23 and 24 Check book balance on check stub No. 25 $1905.00arrow_forwardThe following information is available for Pyle Garage for March, Year 2: BANK STATEMENTHAZARD STATE BANK215 MAIN STREETHAZARD, GA 30321 Pyle Garage629 Main StreetHAZARD, GA 30321 Account number62-00062March 31, Year 2 Beginning balance 3/1/Year 2 $9,070 Total deposits and other credits 30,096 Total checks and other debits 25,024 Ending balance 3/31/Year 2 14,142 Checks and Debits Deposits and Credits Check No. Amount Date Amount 1462 $ 3,795 March 1 $ 1,140 1463 1,684 March 2 6,548 1464 8,040 March 6 4,976 1465 2,946 March 12 6,209 1466 1,449 March 17 6,006 1467 6,220 March 22 2,126 DM 60 CM 3,091 1468 830 The following is a list of checks and deposits recorded on the books of Pyle Garage for March, Year 2: Date Check No. Amount of Check Date Amount of Deposit March 1 1463 $ 1,684 March 1 $ 6,548 March 5…arrow_forward(Learning Objective 1: Show how to speed up cash from receivables) Patterson ShirtCompany sells on credit and manages its own receivables. Average experience for the past threeyears has been the following:Sales..................................................Cost of goods sold.............................Uncollectible-account expense...........Other expenses..................................Cash$250,000125,000—82,500Credit$250,000125,00018,00082,500Total$500,000250,00018,000165,000The owner of Patterson is considering whether to accept credit cards (VISA and MasterCard)instead of granting credit to customers. If Patterson were to accept credit cards, the ownerexpects total sales to increase by 10% but cash sales to remain unchanged. Further, if Pattersonwere to accept credit cards, the business can save $9,000 on other expenses, but the credit cardprocessors charge 3% on credit card sales.Requirement1. Should Patterson Shirt Company start accepting credit cards? Show the computations…arrow_forward
- (Learning Objectives 1, 4, 5, 6: Apply GAAP for revenue, receivables,collections, and uncollectibles using the percent-of-sales method; account for notesreceivable) Hopewell Shipping Corporation is an overnight shipper. Since it sells on credit, thecompany cannot expect to collect 100% of its accounts receivable. At October 31, 2018, and2019, respectively, Hopewell reported the following on its balance sheet (in millions of dollars):October 31,2019 2018Accounts receivable.................................................. $4,200 $4,000Less: Allowance for uncollectible accounts...............Accounts receivable, net........................................... $4,030 $3,840(170) (160)During the year ended October 31, 2019, Hopewell earned service revenue and collected cashfrom customers. Assume uncollectible-account expense for the year was 5% of service revenueon account and Hopewell wrote off uncollectible receivables and made other adjustments as necessary (see below). At year-end,…arrow_forwardQuestion Content Area Using the following information: The bank statement balance is $5,065. The cash account balance is $5,459. Outstanding checks amounted to $866. Deposits in transit are $1,191. The bank service charge is $60. A check for $34 for supplies was recorded as $25 in the ledger. Prepare a bank reconciliation for Candace Co. for May 31. Candace Co. Bank Reconciliation May 31 Cash balance according to bank statement $fill in the blank 1 Adjustments: $- Select - - Select - Total adjustments fill in the blank 6 Adjusted balance $fill in the blank 7 Cash balance according to company's records $fill in the blank 8 Adjustments: $- Select - - Select - Total adjustments fill in the blank 13 Adjusted balance $fill in the blank 14arrow_forwardZebu Inc manager was working on a bank reconciliation statement whereas he identified the following items: Book balance =$32,800 Deposit in Transit = $4,300 Outstanding checks = $2,200 Interest earned on checking account =$100 Customer NSF check returned by bank =$400 He wants to know the adjusted cash balance figure: $34,600 $34,900 $32,500 $32,800 $37,100arrow_forward
- Prepare a bank reconciliation as of December 31, 2020. Use the format shown in Illustration 7A.2 on page 7-35 of our textbook. The data you will need is as follows: Balance per bank statement as of December 31, 2020 $1,738 Deposits in transit as of December 31, 2020 $ 2,500 Outstanding checks as of December 31, 2020 $3,235 Correct Cash Balance as of December 31, 2020 $4,003 Balance per Books as of December 31, 2020 $5,628 Interest collected by the bank in December, 2020 but not recorded in books as of December 31, 2020 $ 600 Bank service charges deducted by the bank in December, 2020 but not recorded in books as of December 31, 2020 $ 75 IN EXCEL FORMAT PLEASEarrow_forwardA bank reconciliation must be performed. First you collect the data from June 30th reconciliation as follows: Balance per Bank $ 10,000 add: Deposits in Transit $ 1,800 deduct: Outstanding Cheques $ (2,200 Balance per Books $ 9,600 Second you close your update your Cash and bank account with all transactions recorded before AJE and you have: Balance July 31 $ 12,000 Deposits $ 7,300 Cheques $ 4,800 Third you look at the bank statement provided by your bank and you see the following: Balance July 31 $ 12,430 Deposits $ 6,000 Cheques $ 4,000 Note collected $ 1,000 Bank service charge $ 20 NSF cheque $ 150 Interest received $ 200 Autowithdrawals $ 500 Which of the following adjusting journal entries is required after the bank reconciliation has been prepared? Dr. Cash $20 Cr. bank fees $20 (to reflect bank fees for the month) Dr. Phone Expenses $500 Cr. Cash $500 (to reflect the automatic payment of the phone - autowithdraw) Dr. Interest…arrow_forwardCompany assembled the following information in completing it is my bank reconciliation balance Per bank 3820, outstanding check 775, deposit in transit 1250, NSF check 80; bank service charge 25; credit memo form bank 80, cash balance per book 4400. as a result of this recognition company will?a. Reduce it cash account by 105 b. Reduce it's cash account by 25 c. Reduce its cash account by 475 d. Increase its cash account by 80arrow_forward
- Title Jamison Company gathered the following reconciling information in preparing its June bank... Description Jamison Company gathered the following reconciling information in preparing its June bank reconciliation:</o:p> Cash balance per bank, 6/30</o:p> $13,000</o:p> Note receivable collected by bank</o:p> 4,000</o:p> Outstanding checks</o:p> 7,000</o:p> Deposits in transit</o:p> 2,500</o:p> Bank service charge</o:p> 35</o:p> NSF check</o:p> 1,900</o:p> Using the above information, determine the cash balance per books (before adjustments) for Jamison Company.</o:p> </o:p> </o:p>arrow_forwardFollowing is a bank reconciliation for Zocar Enterprises for June 30, Year 2: CashAccount BankStatement Balance as of 6/30/Year 2 $ 23,350 $ 20,745 Deposit in transit 3,750 Outstanding checks (400 ) Note collected by bank 1,410 Bank service charge (15 ) NSF check (650 ) Adjusted cash balance as of 6/30/Year 2 $ 24,095 $ 24,095 As part of the normal process for handling an NSF check, the accounting clerk has notified the customer that their account did not contain sufficient funds to pay the balance owed to the company. The customer was told that they will need to provide an alternative form of payment to cover the outstanding balance. c. Assume the clerk had stolen $650 cash, and recorded an entry for a nonexistent NSF check to reduce the cash balance so that it would match the bank balance. Select the internal control practice that would have most likely prevented this…arrow_forwardFollowing is a bank reconciliation for Zocar Enterprises for June 30, Year 2: CashAccount BankStatement Balance as of 6/30/Year 2 $ 23,350 $ 20,745 Deposit in transit 3,750 Outstanding checks (400 ) Note collected by bank 1,410 Bank service charge (15 ) NSF check (650 ) Adjusted cash balance as of 6/30/Year 2 $ 24,095 $ 24,095 As part of the normal process for handling an NSF check, the accounting clerk has notified the customer that their account did not contain sufficient funds to pay the balance owed to the company. The customer was told that they will need to provide an alternative form of payment to cover the outstanding balance. a. Prepare the adjustment that the clerk would have made to record the NSF check.c. Assume the clerk had stolen $650 cash, and recorded an entry for a nonexistent NSF check to reduce the cash balance so that it would match the bank balance.…arrow_forward
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