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 1SE
To determine
Indicate whether the item is an adjustment to the bank balance or the book balance.
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4. Describe the nature of a bank reconciliation statement.
5. Identify common reconciling items and describe each of them.
6. Analyze the effects of the identified reconciling items.
Reference: Quarter 1 Module 9 - Fundamentals of Accountancy, Business and Management 2
LEARNING ACTIVITY 9:1
Presented hereunder are the details of your Cash Receipts Journal, Cash Disbursements Journal and the Bank
Statement of Banco de Oro.
Cash Receipts Journal
O.R. Number
0001
0002
Amount
Date
Payor
P 30,000
June 3
Odessa Allera
20,000
5,000
10,000
20
Arnold Navales
0003
Juanita Nambatac
29
30
0004
Kyle Jamora
Cash Disbursements Journal
Check Number
6581
.6582
6583
6584
Amount
Date
Рayee
Star 5 Grocery
DX Convenience Store
MY Store
Eddie Gomez
P 5,000
7,000
10,000
June 5
15
21
8,000
9,000
25
28
Rodolfo de la Torre
6585
Banco de Oro
Bank Statement
For the month of June, 20A
Date
Withdrawal
Deposit
P 30,000
Balance
June 4
P 30,000
25,000
45,000
15
6581
P 5,000
21
20,000
25
6584
8,000
37,000
28
6585
9,000…
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
lemic Calendar My MCBS Library English (en) -
ndamentals of Financial Accounting
Summer Session 12021/ACT 140/D2 / Final Examination/ AC
In a bank reconciliation statement, explain.
A. Non-sufficient-funds (NSF) check
B. What is a deposit in transit?
A BI -
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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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- (Learning Objectives 4, 5: Account for accounts receivable and uncollectible receivables) On November 30, Palmer Party Planners had a $41,000 balance in Accounts Receivableand a $3,584 credit balance in Allowance for Uncollectible Accounts. During December, Palmermade credit sales of $200,000. December collections on account were $168,000, and write-offsof uncollectible receivables totaled $2,910. Uncollectible-account expense is estimated as 1% ofcredit sales. No sales returns are expected. Ignore cost of goods sold.Requirements1. Journalize sales, collections, write-offs of uncollectibles, and uncollectible-accountexpense by the allowance method during December. Explanations are not required.2. Show the ending balances in Accounts Receivable, Allowance for Uncollectible Accounts,and Net Accounts Receivable at December 31. How much does Palmer expect to collect?3. Show how Palmer Party Planners will report Accounts Receivable and net sales on itsDecember 31 balance sheet and income…arrow_forwardtrail balance not include O revenue. O cost of goods sold. O Ending inventory. O fright-in account. Dividend occur in the O single step income ststement. multiple step statement. O retained earning. Balance sheet.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
- BANK RECONCILIATION AND JOURNAL ENTRIES - In the Bank Reconciliation Template, prepare a bank reconciliation and complete the adjusting entries required. Then upload the completed template to the Lab 17 Upload Link. Use the following data that were accumulated for use in reconciling the bank account of Star Battles Restaurant for-October 2020: a. The bank service charge is $70. b. The book balance is $6,100 at October 31, 2020. c. Outstanding checks total $1,300. d. An automatic EFT withdrawal was taken from the account to pay utilities in the amount of $2,700. A check from LukeCo for $3,500 was returned for nonsufficient funds. f The bank received an EFT from Leah Corp and deposited S14,300 in the account. The EFT was from Leah Corp to pay rent. | The bank balance at October 31, 2020 was $9,730. e. h The bank collected a note in the amount of $1,500 deposited the cash in Vader's account at the bank but Vader has not yet entered the amount in the books. The total of $1,500 consists of…arrow_forwardJournal Entry for Payee when giving note * to either the maker or a bank Debit Cash, Credit Notes Receivable, Credit Interest Revenue for (cash X interest rate X months/12) Debit Cash, debit Notes Receivable, Credit Interest Revenue for (cash X interest rate X months/12) debit Notes Receivable, credit cash, Credit Interest Revenue for (cash X interest rate X months/12)arrow_forwardb. Deposits in transit, $1,500. The following items could appear on a bank reconciliation: d. Bank collection of note receivable of $800, and interest of $80. fallowing items could appear on a bank reconciliation: Learn a. Outstanding checks, $670. NSF check from customer, no. 548, for $175. e Interest earned on bank balance, $20. f. Service charge, $10. The business credited Cash for $200. The correct amount was $2,000. h. The bank incorrectly decreased the business's account by $350 for a check written by another business. Classify each item as (1) an addition to the book balance, (2) a subtraction from the book balance, (3) an addition to the bank balance, or (4) a subtraction from the bank balance.arrow_forward
- Which one is the correct formula for BRS Select one: O a. Balance as per Books- Interest Income from Bank- error in cheques+ Bank Collection Fee- NSF Check D. Balance as per Books+ Interest Income from Bank+ error in cheques- Bank Collection Fee- NSF Check O b. Balance as per Books+ Interest Income from Bank- error in cheques- Bank Collection Fee- NSF Check O c. Balance as per Books+ Interest Income from Bank+ error in cheques+ Bank Collection Fee- NSF Check Clear my choicearrow_forwardIndicate what effect each situation will have on the bank reconciliation process. Place the number of your choice beside the items listed. 1. Add to bank balance 2. Deduct from bank balance 3. Add to checkbook balance 4. Deduct from checkbook balance a. deposit in transit b. bank service charge c. NSF check d. Check written for $95 recorded on the company's ledger as $59 e. Outstanding checks f. Check written for $80 recorded as $800 g. Check printing charges h. Interest earned on checking accountarrow_forwardSUNDAY about:blank lawkes Learning | Home ion II Saved Help Save & Exit Egrane, Inc.s monthly bank statement showed the ending balance of cash of $14,800. The bank reconciliation for the period showed an adjustment for a deposit in transit of $1,200, outstanding checks of $1,600, a NSF check of $560, bank service charges of $24 and the EFT from a customer in payment of the customer's account of $1,200. What journal entry should be recorded by Egrane for the EFT? =32 Multiple Choice Debit Cash and credit Sales Revenue for $1,200. No journal entry is necessary for this item. Debit Accounts Receivable and credit Cash for $1,200. Debit Cash and credit Accounts Receivable for $1,20. MacBook DII DD 吕0 F8 F9 F10 F3 F4 F5 F6 F7 #3 24 & へ 4. 6 7 8 9 T Y つarrow_forward
- No.5 Learning Example Whilst preparing a bank reconciliation statement at 31 December. The following items caused a difference between the bank statement balance and the cash book balance. 1.Bank interest charged to the account in error 2.Direct debit for $500 for insurance 3.Bank charges of $70 4.Cheque paid to a supplier on 29 December 5.Receipt from a trade receivable by electronic transfer Required Which of these items will result in an adjustment to the balance per the bank statement? A.2, 3, and 5 B. 1 and 4 C. 1,4, and 5 D1,3, and 5arrow_forwardThe 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.arrow_forwardUse the information from the attached image to answer questions 10 – 14. This is Mason's monthly bank statement and check register. What is the ending balance on the statement? Answers A. $1,352.61 B. $1,257.23 C. $1,241.66 D. $747.61 Question11. What is the total of the outstanding deposits? Answers A. $20 B. $625 C. $605 D. $8 Question12. What is the total of the outstanding withdrawals? Answers A. $130.95 B. $87.38 C. $8.00 D. $43.57 Question13. What is the revised statement balance? Answers A. $1,241.66 B. $1,277.23 C. $1,233.66 D. $1,352.61 Question14. What is the revised balance of the check register? Answers A. $1,198.09 B. $1,257.23 C. $1,233.66 D. $1,291.66arrow_forward
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