80.2K

Verified Solution

Link Copied!

Required:

1. Prepare the bank reconciliation for this company as of July 31, 2017.

2. Prepare the journal entries necessary to bring the companys book balance of cash into conformity with the reconciled cash balance as of July 31, 2017.

3. Assume that the July 31, 2017, bank reconciliation for this company is prepared and some items are treated incorrectly. For each of the following errors, explain the effect of the error on (i) the adjusted bank statement cash balance and (ii) the adjusted Cash account book balance.

a. The companys unadjusted Cash account balance of $27,497 is listed on the reconciliation as $27,947.

b. The banks collection of the $8,000 note less the $45 collection fee is added to the bank statement cash balance on the reconciliation.

Cash & Internal Controls Homework Handout PROBLEM 8-4 (page 374 in Fundamental Accounting Principles, 23 ed.) The following information is available to reconcile Br its bank statement cash balance as of July 31, 2017 anch Company's book balance of cash with a On lul 3, the company's Cash acount 27 497 dbit balance, but its luly bank b. Check No. 3031 for $1,482 and Check No. 3040 for $$58 were outstanding on the lune statement shows a $27,233 cash balance. 30 bank reconciliation.Check No. 3040 is listed with the July canceled checks, but Check No. 3031 is not. Also, Check No. 3065 for $382 and Check No. 3069 for $2,281, both written in July, are not among the canceled checks on the July 31 statement In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that Check No. 3056 for July rent was correctly writtern and drawn for $1,270 but was erroneously entered in the accounting records as $1,250 c. d. The July bank statement shows the bank collected $8,000 cash on a noninterest-bearing note for Branch, deducted a $45 collection fee, and credited the remainder to its account. Branch had not recorded this event belore receiving the statement. The bank statement shows an $805 charge for a $795 NSF check plus a $10 NSF charge. The check had been received from a customer, Evan Shaw. Branch has not yet recorded this check as NSF e. f. The July statement shows a $25 bank service charge, It has not yet been recorded in Miscellaneous Expenses because no previous notification had been received Branch's July 31 dally cash receipts of $11,514 were placed in the bank's night depository on that date but do not appear on the July 31 bank statement E. Required: 1. Prepare the bank reconciliation for this company as of buly 31, 2017 2. Prepare the journal entries necessary to bring the company's book balance of cash into conformity with the reconciled cash balance as of July 31, 2017 3. Assume that the July 31, 2017, bank reconclilation for this company is prepared and some items are treated incorrectly. For each of the following errors, explain the effect of the error on (0 the adjusted bank statement cash balance and (i) the adjusted Cash account book balance. a. The company's unadjusted Cash account balance of $27,497 is listed on the reconcillation as $27,947 b. The bank's collection of the $8,000 note less the $45 collection fee is added to the bank statement cash balance on the reconciliation

Answer & Explanation Solved by verified expert

See Answer