Question
In: Accounting
The cash account for Corey’s Construction Company at August 31, 2020, indicated a book balance of...
The cash account for Corey’s Construction Company at August 31, 2020, indicated a book balance of $19,885. The bank statement received by the company indicated a balance of $39,473.63 as at August 31, 2020. A comparison of the bank statement and the accompanying cancelled cheques and memos with the records revealed the following:
- A deposit of $6,794.62 was received by the bank on August 31 after the bank statement was prepared.
- Cheques #251 for $1,200 and #260 for $1,333.25 were not presented to the bank for encashment as at August 31, 2020.
- The bank erroneously debited a cheque drawn Corey’s Construction as $16,000 instead of $1,600.
- The company’s accountant recorded a $3,500.00 cheque for payment of accounts payables as $35,000
- The bank credited a deposit of $200 as $2,000 to Corey’s Construction account.
- A cheque for $13,500 from a customer Ali Woods was returned for insufficient funds. The bank charged $50 for Wood’s NSF cheque. The company’s policy states that the bank charges associated with NSF cheques are to be recovered from the customer.
- A note was collected by the bank of $21,000 on August 31 which included interest of $1,500.
- A debit memo from the bank showed service charge amounting to $2,500 as at August 31, 2020.
Required:
- Prepare the necessary journal entries for Corey’s Construction Company at August 31, 2020.
- Prepare Corey’s Construction Company adjusted cash book to be included in the balance sheet for August 31st. 2020.
- Prepare Corey’s Construction Company bank reconciliation statement for August 31, 2020
Solutions
Expert Solution
1.
|
Date |
Account Titles and explanation |
Debit |
Credit |
|
Aug. 31 |
Cash 35000-3500) |
$31500 |
|
|
Accounts Payable |
$31500 |
||
|
(To correct the error made by accountant) |
|||
|
Aug. 31 |
Cash |
$21000 |
|
|
Interest revenue/receivable |
$1500 |
||
|
Notes receivable |
$19500 |
||
|
(To record the collection of notes receivable directly by bank) |
|||
|
Aug. 31 |
Bank charges |
$2500 |
|
|
Cash |
$2500 |
||
|
(To record the bank charges on the statement) |
|||
|
Aug. 31 |
Accounts receivable |
$13550 |
|
|
Cash |
$13550 |
||
|
(To record the NSF check) |
2.
|
Particulars |
Amount |
|
Balance as per books |
$19885 |
|
Add: Correction of error |
$31500 |
|
Add: Note collected by bank |
$21000 |
|
Less: Bank charges |
$2500 |
|
Less: NSF Check |
$13550 |
|
Adjusted cash balance |
$56335 |
3.
|
Bank Reconciliation |
|
|
Amount |
|
|
Balance as per bank |
$39,473.63 |
|
Add: |
|
|
Deposit in transit |
$6794.62 |
|
Erroneous debit($16000-$1600) |
$14400 |
|
Less: |
|
|
Cheque not presented #251 |
$1200 |
|
Cheque not presented #260 |
$1333.25 |
|
Erroneous credit |
$1800 |
|
Adjusted bank balance on August 31 |
$56,335 |
|
Balance as per books |
$19885 |
|
Add: Correction of error |
$31500 |
|
Add: Note collected by bank |
$21000 |
|
Less: Bank charges |
$2500 |
|
Less: NSF Check |
$13550 |
|
Adjusted cash balance on August 31 |
$56335 |
ekkarill92 answered 1 year agoRelated Solutions
The cash account for Corey’s Construction Company at August 31, 2018, indicated a book balance of...
The cash account for Corey’s Construction Company at August 31,
2018, indicated a book balance of $19,885. The bank statement
received by the company indicated a balance of $39,473.63 as at
August 31, 2018. A comparison of the bank statement and the
accompanying cancelled cheques and memos with the records revealed
the following:
A deposit of $6,794.62 was received by the bank on August 31
after the bank statement was prepared.
Cheques #251 for $1,200 and #260 for $1,333.25 were...
The cash account for Corey’s Construction Company at August 31, 2018, indicated a book balance of...
The cash account for Corey’s
Construction Company at August 31, 2018, indicated a book balance
of $19,885. The bank statement received by the company indicated a
balance of $39,473.63 as at August 31, 2018. A comparison of the
bank statement and the accompanying cancelled cheques and memos
with the records revealed the following:
A deposit of $6,794.62 was
received by the bank on August 31 after the bank statement was
prepared.
Cheques #251 for $1,200 and #260
for $1,333.25 were...
Bank Reconciliation Statement. The cash account for Corey’s Construction Company at August 31, 2020, indicated a...
Bank Reconciliation Statement.
The cash account for Corey’s Construction Company at August 31,
2020, indicated a book balance of $19,885. The bank statement
received by the company indicated a balance of $39,473.63 as at
August 31, 2020. A comparison of the bank statement and the
accompanying cancelled cheques and memos with the records revealed
the following:
A deposit of $6,794.62 was received by the bank on August 31
after the bank statement was prepared.
Cheques #251 for $1,200 and #260...
On August 31, 2019, the balance in the checkbook and the Cash account of the Dry...
On August 31, 2019, the balance in the checkbook and the
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Notes
The firm’s records indicate that a $1,400 deposit dated August
30 and a $696 deposit dated August 31 do not appear on the bank
statement.
A service charge of $8 and a debit memorandum of $295 covering
an NSF check have not yet been...
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On August 31, 2019, the balance in the checkbook and the Cash
account of the Dry Creek Bed and Breakfast was $12,981. The balance
shown on the bank statement on the same date was $13,897. Notes The
firm’s records indicate that a $1,500 deposit dated August 30 and a
$701 deposit dated August 31 do not appear on the bank statement. A
service charge of $8 and a debit memorandum of $270 covering an NSF
check have not yet been...
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On August 31, 2019, the balance in the checkbook and the Cash
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shown on the bank statement on the same date was $13,232. Notes The
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$708 deposit dated August 31 do not appear on the bank statement. A
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Notes
The firm’s records indicate that a $1,470 deposit dated August
30 and a $703 deposit dated August 31 do not appear on the bank
statement.
A service charge of $9 and a debit memorandum of $330 covering
an NSF check have not yet been...
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On August 31, 20X1, the balance in the checkbook and the Cash
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an NSF check have not yet been...
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A service charge of $8 and a debit memorandum of $365 covering
an NSF check have not yet been...
On August 31, 2019, the balance in the checkbook and the Cash account of the Dry...
On August 31, 2019, the balance in the checkbook and the
Cash account of the Dry Creek Bed and Breakfast
was $12,253. The balance shown on the bank statement on the same
date was $13,182.
Notes
The firm’s records indicate that a $1,420 deposit dated August
30 and a $698 deposit dated August 31 do not appear on the bank
statement.
A service charge of $7 and a debit memorandum of $305 covering
an NSF check have not yet been...
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