Chapter 1 Problem 4-16
Balance per book – November 30 500,000
Less: Service charge 10,000
NSF check 50,000
Customer’s note erroneously recorded as cash receipt 100,000 160,000
Adjusted book balance 340,000
Balance per bank – November 30 600,000
Add: Deposit in transit 120,000
Total 720,000
Less: Outstanding checks 380,000
Adjusted bank balance 340,000
Deposit in transit – October 31 45,000
Cash receipts deposited:
Book debits 710,000
October collections recorded in November ( 45,000)
Customer’s note recorded as cash receipt (100,000) 565,000
Total 610,000
Less: Deposits credited by bank:
Bank credits 500,000
Correction of bank error ( 10,000) 490,000
Deposit in transit – November 30 120,000
Outstanding checks – October 31 125,000
Checks issued by depositor:
Book credits 1,200,000
October bank service charge ( 5,000) 1,195,000
Total 1,320,000
Checks paid by bank:
Bank debits 1,000,000
November bank service charge ( 10,000)
November NSF check ( 50,000) 940,000
Outstanding checks – November 30 380,000
Adjusting entry:
Bank service charge 10,000
Accounts receivable 50,000
Note receivable 100,000
Cash in bank 160,000
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