In: Accounting
The bookkeeper at Hopkins Company has not reconciled the bank statement with the cash account, saying instead, “I don’t have time.” You have been asked to prepare a reconciliation and review the procedures with the bookkeeper. |
The April 30, 2018, bank statement and the April ledger accounts for cash showed the following (summarized): |
Bank Statement | |||||||||
Cheques | Deposits | Balance | |||||||
Balance, April 1, 2018 | $ | 34,000 | |||||||
Deposits during April | $ | 37,600 | 71,600 | ||||||
Notes collected for company | |||||||||
(including $85 interest) | 1,330 | 72,930 | |||||||
Cheques cleared during April | $ | 46,000 | 26,930 | ||||||
NSF cheque—A. B. Wright | 175 | 26,755 | |||||||
Bank service charges | 85 | 26,670 | |||||||
Balance, April 30, 2018 | 26,670 | ||||||||
Cash in Bank |
Apr. 1 Balance | 25,000 | Apr. Cheques written | 42,600 | |
Apr. Deposits | 43,750 |
Cash on Hand |
Apr. 30 Balance | 250 |
A comparison of cheques written before and during April with the cheques cleared through the bank showed that cheques of $5,600 are still outstanding at April 30. No deposits in transit were carried over from March, but a deposit was in transit at April 30. |
Required: | |
1. |
Prepare a detailed bank reconciliation at April 30, 2018. |
2. |
Prepare any required journal entries as a result of the reconciliation. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) |
3. |
What were the balances in the cash accounts in the ledger on May 1, 2018? |
4. |
What total amount of cash should be reported on the statement of financial position at April 30, 2018? |
Sollution 1 | |||
Hopkins Company | |||
Bank Reconciliation - at April 30, 2018 | |||
Bank's Cash balance | Company's cash balance | ||
Particulars | Particulars | Amount | |
Ending balance as per Bank Statements | $26,670.00 | Ending Balance as per cash books | $26,150.00 |
Additions: | Additions: | ||
Deposit In Transit($43750-$37600) | $6,150.00 | Note Collection By Bank | $1,330.00 |
Deductions: | |||
Deductions: | |||
Outstanding Checks | $5,600.00 | NSF Checks | $175.00 |
Service Charge | $85.00 | ||
Adjusted bank balance | $27,220.00 | Adjusted Cash balance | $27,220.00 |
Sollution 2 | ||||
Journal Entries | ||||
No. | Transaction | Particulars | Debit | Credit |
1 | A | No Journal Entry Required | ||
2 | B | Cash Dr | $1,330.00 | |
Note receivables | $1,330.00 | |||
(To record note collection by bank Including $85 Interest ) | ||||
3 | C | No Journal Entry Required | ||
4 | D | Accounts receivables Dr | $175.00 | |
To Cash | $175.00 | |||
(To record NSF check from customer) | ||||
5 | E | Miscellenous Expenses Dr | $85.00 | |
To Cash | $85.00 | |||
(Being service charges debited by bank) | ||||
Sollution 3 | ||||
cash Balance in the ledger on May 1, 2018 of Hopkins Company have on =$27220 | ||||
Sollution 4 | ||||
cash should be reported on the statement of financial position at April 30, 2018 =$27220 |