Your review of last month's bank reconciliation and the current bank statement reveals the following: 1. Outstanding checks November 30, 2021 P254,720 : December 31, 2021 335,610 2. Deposits in transit November 30, 2021 164,220 December 31, 2021 209,180 3. Check no. 359 for office repairs was written for P6,950 but recorded in the cash disbursements journal as P9,650. The bank deducted the check as P6,950. The error happened in November and is not yet corrected as of December 31. 4. A check written on the account of YYY Corporation for P5,830 was deducted by the bank from XXX's account. 5. Included with the bank statement was a debit memorandum dated December 31 for P24,750 for interest on a note taken out by XXX on November 30. 6. The service charge for the new checks has not been recorded. 7. The November 30 bank reconciliation showed as reconciling item a service charge of P3,500 and a customer's DAIF check for P34,900.

Your review of last month's bank reconciliation and the current bank statement reveals the following: 1. Outstanding checks November 30, 2021 P254,720 : December 31, 2021 335,610 2. Deposits in transit November 30, 2021 164,220 December 31, 2021 209,180 3. Check no. 359 for office repairs was written for P6,950 but recorded in the cash disbursements journal as P9,650. The bank deducted the check as P6,950. The error happened in November and is not yet corrected as of December 31. 4. A check written on the account of YYY Corporation for P5,830 was deducted by the bank from XXX's account. 5. Included with the bank statement was a debit memorandum dated December 31 for P24,750 for interest on a note taken out by XXX on November 30. 6. The service charge for the new checks has not been recorded. 7. The November 30 bank reconciliation showed as reconciling item a service charge of P3,500 and a customer's DAIF check for P34,900.

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 5E

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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.
In connection with your examination, the Caliao Company presented to you the following information regarding its Cash in Bank account for the month of December 2020: A. Balances per bank statements: November 30, P215,600 and December, P230,400. B. Balances of cash in bank account in company's books: November 30, P165,450 and December 31, P226,800. C. Total receipts per book were P2,221,900 of which P12,100 was paid in cash to a creditor on December 24. D. Total charges in the bank statement during December were P2,189,700. E. Undeposited receipts were: November 30, P90 600 and December 31, P101,200. F. Outstanding checks were: November 30, P26,750 and December 31, P19,300, of which a check for P5,000 was certified by the bank on December 26. G. NSF checks returned, recorded as reduction of cash receipts were: Returned by bank on December and recorded also in December P10,400. Returned by bank on December but recorded also in January P8,600. H. Collections by bank not recorded by…
In connection with your examination, the Caliao Company presented to you the following information regarding its Cash in Bank account for the month of December 2020: A. Balances per bank statements: November 30, P215,600 and December, P230,400. B. Balances of cash in bank account in company’s books: November 30, P165,450 and December 31, P226,800. C. Total receipts per book were P2,221,900 of which P12,100 was paid in cash to a creditor on December 24. D. Total charges in the bank statement during December were P2,189,700. E. Undeposited receipts were: November 30, P90 600 and December 31, P101,200. F. Outstanding checks were: November 30, P26,750 and December 31, P19,300, of which a check for P5,000 was certified by the bank on December 26. G. NSF checks returned, recorded as reduction of cash receipts were:  Returned by bank on December and recorded also in December P10,400.  Returned by bank on December but recorded also in January P8,600. H. Collections by bank not recorded by…
In connection with your examination, the Caliao Company presented to you the following information regarding its Cash in Bank account for the month of December 2020: A. Balances per bank statements: November 30, P215,600 and December, P230,400. B. Balances of cash in bank account in company’s books: November 30, P165,450 and December 31, P226,800. C. Total receipts per book were P2,221,900 of which P12,100 was paid in cash to a creditor on December 24. D. Total charges in the bank statement during December were P2,189,700. E. Undeposited receipts were: November 30, P90 600 and December 31, P101,200. F. Outstanding checks were: November 30, P26,750 and December 31, P19,300, of which a check for P5,000 was certified by the bank on December 26. G. NSF checks returned, recorded as reduction of cash receipts were: Returned by bank on December and recorded also in December P10,400. Returned by bank on December but recorded also in January P8,600. H. Collections by bank not recorded by…
In connection with your examination, the Caliao Company presented to you the following information regarding its Cash in Bank account for the month of December 2020: A. Balances per bank statements: November 30, P215,600 and December, P230,400. B. Balances of cash in bank account in company’s books: November 30, P165,450 and December 31, P226,800. C. Total receipts per book were P2,221,900 of which P12,100 was paid in cash to a creditor on December 24. D. Total charges in the bank statement during December were P2,189,700. E. Undeposited receipts were: November 30, P90 600 and December 31, P101,200. F. Outstanding checks were: November 30, P26,750 and December 31, P19,300, of which a check for P5,000 was certified by the bank on December 26. G. NSF checks returned, recorded as reduction of cash receipts were:  Returned by bank on December and recorded also in December P10,400.  Returned by bank on December but recorded also in January P8,600. H. Collections by bank not recorded by…
In connection with your examination, the Caliao Company presented to you the following information regarding its Cash in Bank account for the month of December 2020: A. Balances per bank statements: November 30, P215,600 and December, P230,400. B. Balances of cash in bank account in company’s books: November 30, P165,450 and December 31, P226,800. C. Total receipts per book were P2,221,900 of which P12,100 was paid in cash to a creditor on December 24. D. Total charges in the bank statement during December were P2,189,700. E. Undeposited receipts were: November 30, P90 600 and December 31, P101,200. F. Outstanding checks were: November 30, P26,750 and December 31, P19,300, of which a check for P5,000 was certified by the bank on December 26. G. NSF checks returned, recorded as reduction of cash receipts were: Returned by bank on December and recorded also in December P10,400. Returned by bank on December but recorded also in January P8,600. H. Collections by bank not recorded by…
Odum Corporation’s cash account showed a balance of $17,000 on March 31, 2019. The bank statement balance for the same date indicated a balance of $17,711.55. The following additional information is available concerning Odum’s cash balance on March 31: • Undeposited cash on hand on March 31 amounted to $724.50. • A customer’s NSF check for $175.80 was returned with the bank statement. • A note for $2,000 plus interest of $25 was collected for Odum by the bank during March. The bank notified Odum of this collection on the bank statement. • The bank service charge for March was $15. • A deposit of $960.75 mailed to the bank on March 31 did not appear on the bank statement. The following checks mailed to creditors had not been processed by the bank on March 31: Check # Amount 429 $57.40 432 147.50 433 210.80 434 191.90 A customer check for $149.50 in payment of his account and listed correctly for that amount on the bank statement had been incorrectly…
You are auditing the cash account of GSP Company with a balance of P 840,000 as of December 31, 2022. On deposit in a current account with the Banco de Oro Cash collections not yet deposited to the bank A customer's check returned by the bank for insufficient fund A check drawn by the Vice President of the company dates January 15, 2023 A check drawn by a supplier dated December 28, 2022 for goods returned by GSP Petty Cash Fund of which P 12,000 is in currency; P 4,000 in form of IOUS, and P 4,0 by approved petty cash vouchers for expenses all dated prior to closing of the books 31, 2022 TOTAL Less: Overdraft with BPI secured by a chattel mortgage on the inventories Balance per ledger What is cash balance that would be reported in the statement of financial position as at December 31, 2022? O 1,208,000 O 1,182,000 O 1,220,000 O 1,350,000
In the course of your company's audit to BLACKPINK CORPORATION'S cash in bank for the year ended December 31, 2026, you ascertained the following information: NOVEMBER 30 DECEMBER 31 Cash per book 60,350 ? Cash per bank statement 535,410 689,085 Undeposited Checks 41,005 64,400 Outstanding checks 138,590 150,560 Insufficient fund check - 41,250 Bank service charges 3,600 3,000 Company's notes receivable collected by bank 359,075 404,500 The bank statement and the company's records shows the following totals: Cash disbursements per bank statement 1,091,865 Cash receipts per cash records ? Cash disbursements per cash records ? Cash receipts pre bank statement 1,245,540 Additional information: 1. The insufficient fund check was redeposited in the same month. No entries are made to take up the return and redeposit? 2. A P50,000 bank charge error in November was corrected by the bank in December, while a P20,000 deposit of the house-boy corporation was…
In the course of your company's audit to BLACKPINK CORPORATION'S cash in bank for the year ended December 31, 2026, you ascertained the following information: NOVEMBER 30 DECEMBER 31 Cash per book 60,350 ? Cash per bank statement 535,410 689,085 Undeposited Checks 41,005 64,400 Outstanding checks 138,590 150,560 Insufficient fund check - 41,250 Bank service charges 3,600 3,000 Company's notes receivable collected by bank 359,075 404,500 The bank statement and the company's records shows the following totals: Cash disbursements per bank statement 1,091,865 Cash receipts per cash records ? Cash disbursements per cash records ? Cash receipts pre bank statement 1,245,540 Additional information: 1. The insufficient fund check was redeposited in the same month. No entries are made to take up the return and redeposit? 2. A P50,000 bank charge error in November was corrected by the bank in December, while a P20,000 deposit of the house-boy corporation was…
In the course of your company's audit to BLACKPINK CORPORATION'S cash in bank for the year ended December 31, 2026, you ascertained the following information: NOVEMBER 30 DECEMBER 31 Cash per book 60,350 ? Cash per bank statement 535,410 689,085 Undeposited Checks 41,005 64,400 Outstanding checks 138,590 150,560 Insufficient fund check - 41,250 Bank service charges 3,600 3,000 Company's notes receivable collected by bank 359,075 404,500 The bank statement and the company's records shows the following totals: Cash disbursements per bank statement 1,091,865 Cash receipts per cash records ? Cash disbursements per cash records ? Cash receipts pre bank statement 1,245,540 Additional information: 1. The insufficient fund check was redeposited in the same month. No entries are made to take up the return and redeposit? 2. A P50,000 bank charge error in November was corrected by the bank in December, while a P20,000 deposit of the house-boy corporation was…
Assume that you have audited accounts receivable as of 12/31/2020 and are confident that the ending balance should be $7,188,000. Further, you know that the audited balance as of 12/31/2019 was $8,462,000. You also verified cash deposits from customers through a review of the bank account. Based on that review you believe that cash receipts from customers ranges from an amount of $40,000,000 to $41,000,000. Which amount below would represent an overstatement of revenue for the year ending 12/31/2020, based on the facts above? 1. $38,500,000 2. $41,000,000 3. $39,762,000 4. $39,100,000