Question

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?

     

Answer 1

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