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Exercises:

Exercises:. PE 8-2A: Items on company’s bank statement The following items may appear on a bank statement: EFT payment Note collected for company Bank correction of an error from recording a $7,200 deposit as $2,700 Service charge

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Exercises:

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  1. Exercises: PE 8-2A: Items on company’s bank statement The following items may appear on a bank statement: EFT payment Note collected for company Bank correction of an error from recording a $7,200 deposit as $2,700 Service charge Indicate whether each item would appear as a debit or credit memo on the bank statement and whether the item would increase or decrease the balance of the company’s account.

  2. PE 8-2B: Items on company’s bank statement. The following items may appear on a bank statement: • EFT check • Bank correction of an error from posting another customer’s check to the company’s account. • Loan proceeds • EFT deposit Indicate whether each item would appear as a debit or credit memo on the bank statement and whether the item would increase or decrease the balance of the company’s account.

  3. BE 8-3A: Bank reconciliation: The following data were gathered to use in reconciling the bank account of a company: Balance per bank $25,500 Balance per company records $27,475 Bank service charges 75 Deposit in transit 7,500 NSF check 3,400 Outstanding checks 9,000 • What is the adjusted balance on the bank reconciliation? • Journalize any necessary entries for the company based on the bank reconciliation.

  4. BE 8-3B: Bank reconciliation: The following data were gathered to use in reconciling the bank account of a company: Balance per bank $17,400 Balance per company records $5,765 Bank service charges 125 Deposit in transit 3,000 Note collected by bank with $360 interest 9,360 Outstanding checks 5,400 • What is the adjusted balance on the bank reconciliation? • Journalize any necessary entries for the company based on the bank reconciliation.

  5. PE 8-4A: Petty cash fund Prepare journal entries for each of the following: • Issued a check to establish a petty cash fund of $800 • The amount of cash in the petty cash fund is $225. Issued a check to replenish the fund, based on the following summary of petty cash receipts: repair expense $450, and miscellaneous selling expense $75. Record any missing funds in the cash short and over account.

  6. PE 8-4B: Petty cash fund Prepare journal entries for each of the following: • Issued a check to establish a petty cash fund of $750 • The amount of cash in the petty cash fund is $325. Issued a check to replenish the fund, based on the following summary of petty cash receipts: store supplies $300, and miscellaneous selling expense $100. Record any missing funds in the cash short and over account.

  7. EX 8-16 Bank reconciliation Identify each of the following reconciling items: (non of the transactions reported by bank debit and credit memos have been recorded by the company) • Bank service charges $120 • Check of a customer returned by bank to company because of insufficient funds 4,200 • Check for $240 incorrectly recorded by the company as $420 • Check for $1000 incorrectly charged by bank as $10,000 • Deposit in transit $24,950 • Outstanding checks $18,100 • Note collected by bank $15,600

  8. EX 8-18 Bank reconciliation • Cash balance according to the company’s records at July 31, $15,600. • Cash balance according to the bank statement at July 31, $16,230. • Checks outstanding, $3,180 • Deposit in transit, not recorded by bank $2,950 • A check for $270 in payment of an account was erroneously recorded in the check register as $720 • Bank debit memo for service charges, $50 • Prepare a bank reconciliation • Must a bank reconciliation always balance (reconcile)?

  9. EX 8-22 Bank reconciliation Identify the errors in the following bank reconciliation Alma Co. Bank reconciliation for the month ended Nov 20 2012 Cash balance according to bank statement $12,090 Add: outstanding checks: No.915 $850 No.960 $615 No.964 $850 No.965 $775 $3,090 = $15,180 Deduct: deposit of Nov 30,not recorded by bank $4000 Adjusted balance $11,180 ______________________________________________________________________ Cash balance according to company’s records $4,430 Add: proceeds of note collected by bank: Principle $5,000 Interest $200 = $ 5,200 Service charges $30 = $ 5,230 = 9660 Deduct: Check returned because of insufficient funds $1,100 Error in recording Nov 23 deposit of $6100 as $1600 $4500 = 5,600 Adjusted balance $4,060

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