On arriving his office at Efficient Systems Inc.(ESI) early morning Monday, Mr. Laziross w Mr. Terribeel...

On arriving his office at Efficient Systems Inc.(ESI) early morning Monday, Mr. Laziross w Mr. Terribeel asked him why the company's cash balance was different from the checking Mr. Laziross listed the following items to explain the difference. 1 The bank statement for the checking account of ESI showed a balance of $14632.12 on S 2 Oustanding checks were $1,320.25 3 The September 30 cash receipts of $575 were not deposited in the bank until October 2. 4 One check written in payment of rent for $246 was not correctly recorded by the bank but 5 In accordance with prior authorization, the bank withdrew $450 directly from checking account as payment on note payable. The interest portion of that payment was 6 Bank service charge of $14 were listed on the bank statement. 7 A deposit of $875 was recorded by the bank on September 13, but it did not belong to ESI. 8 The bank statement included a charge of $85 for an NSF check. The check was returned 9 ESI maintains a $200 petty cash fund that was approrpiately reimbursed at the end of Sept 10 According to instructions from ESI on September 30, the bank withdrew $10,000 from the ESI recorded the transaction in its books on September 30 when it received notice from th Prepare the adjustment of Book balance to Corrected Balance. Correct Adjustments: Balance per book Dr.

Solutions

Expert Solution

Solution:

Balance Bank Statement   14,632.12
Deposits outstanding   575
Checks outstanding   -1320.25
Error recording rent check   -18
Automatic mortgage payment   450
Bank Service charge   14
Account error   -875
NSF check charge   85
Balance per books   13,542.87


Balance Bank Statement   14,632.12
Deposits outstanding   575
Account error   -875
Checks outstanding   -1320.25
Correct Cash Balance   13,011.87

Book Balance   13,542.87
Error on rent   18
Automatic mortgage payment   -450
Bank Service charge   -14
NSF   -85
   13,011.87

Particulars   Debit   Credit
Cash   18
Rent expense       18

Interest expense   350
Note payable   100
Bank service charges   14
NSF   85
Cash       549

ekkarill92 answered 1 year ago

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