n attempt to keep clerical and office expenses to a minimum, the company has combined the jobs of cashier and bookkeeper. As a esult, Bret Turrin handles all cash receipts, keeps the accounting records, and prepares the monthly bank reconciliations. he balance per the bank statement on October 31, 2022, was $18,890.00. Outstanding checks were No. 62 for $149.00, No. 183 or $171.00, No. 284 for $262.00, No. 862 for $222.00, No. 863 for $277.00, and No. 864 for $202.00. Included with the statement vas a credit memorandum of $209.00 indicating the collection of a note receivable for Crane Company by the bank on October 25. his memorandum has not been recorded by Crane. he company's ledger showed one Cash account with a balance of $22,311.00. The balance included undeposited cash on hand. Because of the lack of internal controls, Bret took for personal use all of the undeposited receipts in excess of $3,803.00. He then repared the following bank reconciliation in an effort to conceal his theft of cash. Cash balance per books, October 31 $22,311.00 Add: Outstanding checks No. 862 $222.00 No. 863 277.00 No. 864 202.00 591.00 22,902.00 Less: Undeposited receipts 3,803.00 Unadjusted balance per bank, October 31 19,099.00
n attempt to keep clerical and office expenses to a minimum, the company has combined the jobs of cashier and bookkeeper. As a esult, Bret Turrin handles all cash receipts, keeps the accounting records, and prepares the monthly bank reconciliations. he balance per the bank statement on October 31, 2022, was $18,890.00. Outstanding checks were No. 62 for $149.00, No. 183 or $171.00, No. 284 for $262.00, No. 862 for $222.00, No. 863 for $277.00, and No. 864 for $202.00. Included with the statement vas a credit memorandum of $209.00 indicating the collection of a note receivable for Crane Company by the bank on October 25. his memorandum has not been recorded by Crane. he company's ledger showed one Cash account with a balance of $22,311.00. The balance included undeposited cash on hand. Because of the lack of internal controls, Bret took for personal use all of the undeposited receipts in excess of $3,803.00. He then repared the following bank reconciliation in an effort to conceal his theft of cash. Cash balance per books, October 31 $22,311.00 Add: Outstanding checks No. 862 $222.00 No. 863 277.00 No. 864 202.00 591.00 22,902.00 Less: Undeposited receipts 3,803.00 Unadjusted balance per bank, October 31 19,099.00
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Crane Company is a very profitable small business. It has not, however, given much consideration to internal control. For example, in
an attempt to keep clerical and office expenses to a minimum, the company has combined the jobs of cashier and bookkeeper. As a
result, Bret Turrin handles all cash receipts, keeps the accounting records, and prepares the monthly bank reconciliations.
The balance per the bank statement on October 31, 2022, was $18,890.00. Outstanding checks were No. 62 for $149.00, No. 183
for $171.00, No. 284 for $262.00, No. 862 for $222.00, No. 863 for $277.00, and No. 864 for $202.00. Included with the statement
was a credit memorandum of $209.00 indicating the collection of a note receivable for Crane Company by the bank on October 25.
This memorandum has not been recorded by Crane.
The company's ledger showed one Cash account with a balance of $22,311.00. The balance included undeposited cash on hand.
Because of the lack of internal controls, Bret took for personal use all of the undeposited receipts in excess of $3,803.00. He then
prepared the following bank reconciliation in an effort to conceal his theft of cash.
Cash balance per books, October 31
$22,311.00
Add: Outstanding checks
No. 862
$222.00
No. 863
277.00
No. 864
202.00
591.00
22,902.00
Less: Undeposited receipts
3,803.00
Unadjusted balance per bank, October 31
19,099.00
Less: Bank credit memorandum
209.00
Cash balance per bank statement, October 31
$18,890.00
Transcribed Image Text:(a) Prepare a correct bank reconciliation. (Hint: Deduct the amount of the theft from the adjusted balance per books.) (List items tha
increase balance as per bank & books first.)
CRANE COMPANY
Bank Reconciliation
$
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