In relation to your audit of the cash in bank of your client, Meg Company, the following information were gathered: • As of May 31, 2016, the book balance is P20,000 and the bank balance is P18,000. • The deposit in transit for May is P10,000; for June, P15,000. • The outstanding checks for May amount to P2,000 and the outstanding checks for June total to P5,000. • Credit memo for May pertain to a collection for a note totalling to P8,000; while for June, the credit memo is P30,000 pertaining to a bank loan. • Debit memos total to P500 for May and P2,000 for June. • A May book disbursement for P1,500 was not recorded. The correction was made in June. • A June collection for P4,500 was not recorded. No correction was made. • Bank errors for June are as follows: a deposit of P10,200 made by the entity was erroneously omitted; and a disbursement made by your client for P3,000 was erroneously debited to the account of MIG Company. No corrections were made during the month. • June book debits – P150,000; June bank debits – P158,000; June cash balance per books (unadjusted) – P6,000; June bank credits – P161,300 The following Proof of Cash for point of view of the Bank & Book was provided that shows adjusted cash balance and total disbursement: June June Bank May 31 (Adjusted Cash balance) Receipts Disbursements made by the entity for June June 30 (Adjusted Cash Balance) Balance 18,000 161,300 158,000 21,300 Deposit in transit – May 10,000 (10,000) Deposit in transit – June 15,000 15,000 Outstanding Check - May (2,000) (2,000) Outstanding Check - June 5,000 (5,000) Error - Deposit 10,200 10,200 Error - Disbursement 3,000 (3,000) Total 26,000 176,500 164,000 38,500 Requirement: Prepare a compound adjusting journal entry to correct the cash in bank balance as of June 30, 2016.
In relation to your audit of the cash in bank of your client, Meg Company, the following information were gathered:
• As of May 31, 2016, the book balance is P20,000 and the bank balance is P18,000.
• The deposit in transit for May is P10,000; for June, P15,000.
• The outstanding checks for May amount to P2,000 and the outstanding checks for June total to P5,000.
• Credit memo for May pertain to a collection for a note totalling to P8,000; while for June, the credit memo is P30,000 pertaining to a bank
loan.
• Debit memos total to P500 for May and P2,000 for June.
• A May book disbursement for P1,500 was not recorded. The correction was made in June.
• A June collection for P4,500 was not recorded. No correction was made.
• Bank errors for June are as follows: a deposit of P10,200 made by the entity was erroneously omitted; and a disbursement made by your
client for P3,000 was erroneously debited to the account of MIG Company. No corrections were made during the month.
• June book debits – P150,000; June bank debits – P158,000; June cash balance per books (unadjusted) – P6,000; June bank credits – P161,300
The following Proof of Cash for point of view of the Bank & Book was provided that shows adjusted cash balance and total disbursement:
|
|
June |
June |
|
|
|
Bank |
May 31 (Adjusted Cash balance) |
Receipts |
Disbursements made by the entity for June |
June 30 (Adjusted Cash Balance) |
|
Balance |
18,000 |
161,300 |
158,000 |
21,300 |
|
Deposit in transit – May |
10,000 |
(10,000) |
|
|
|
Deposit in transit – June |
|
15,000 |
|
15,000 |
|
Outstanding Check - May |
(2,000) |
|
(2,000) |
|
|
Outstanding Check - June |
|
|
5,000 |
(5,000) |
|
Error - Deposit |
|
10,200 |
|
10,200 |
|
Error - Disbursement |
|
|
3,000 |
(3,000) |
|
Total |
26,000 |
176,500 |
164,000 |
38,500 |
Requirement:
Prepare a compound
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