Required: 1. Prepare Gambit's general journal entry to record both the reimbursement and the increase of the petty fund on January 30. 2. Prepare the January bank reconciliation for Gambit. 3. Prepare the general journal entries to bring the company's book balance of cash into conformity with the reconciled balance as of January 30.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Gambit Company has the following information as of January 30:
Treasury Bills - P 500,000
Money Market - P35,000
Short-term investments purchased within 3 months of maturity - P50,000
Investments to be held for 3 years - P300,000
Also, Gambit Company established a Php 20,000 petty cash fund by issuing a
check to the custodian on January 1. On January 30, the petty cash fund was
replenished and increased to Php 30,000 in total. The contents of the petty cash
fund at the time of the January 30 replenishment were:
Currency and coins P3,500
Petty cash receipts for:
Transportation-in for inventory 2,000
Delivery expense.
3,000
Repairs to office equipment.
Entertainment of customers.
5,000
6,000
The company uses the perpetual inventory method.
The following information is available for the Gambit Company for the month of
January.
a. On January 30, after all transactions have been recorded, the balance in the
company's Cash account has a balance of P894,000.
b. The company's bank statement shows a balance on January 30 of P760,000.
c. Outstanding checks at January 30 total P15,000.
d. A deposit placed in the bank's night depository on January 30 totaling P58,000
did not appear on the bank statement.
e. The bank collected P60,000 on a note receivable that is not yet recorded by
Gambit Company.
f. A P150,000 NSF check from a customer, is shown on the bank statement but
not yet recorded by the company.
g. Comparing the checks on the bank statement with the entries in the accounting
records reveals that check #12345 for the payment of an account payable was
correctly written for P656,000, but was recorded in the accounting records as
P666,000.
h. Included with the bank statement was a bank service charge in the amount of
P10,000. It has not been recorded on the company's books.
i. The bank charged P1,000 as fee for check collections. This has not been
recorded on the company's books.
Required:
1. Prepare Gambit's general journal entry to record both the reimbursement and
the increase of the petty fund on January 30.
2. Prepare the January bank reconciliation for Gambit.
3. Prepare the general journal entries to bring the company's book balance of
cash into conformity with the reconciled balance as of January 30.
4. How much is the the Cash and Cash Equivalents which should be presented in
Gambit's Balance Sheet?
Transcribed Image Text:Gambit Company has the following information as of January 30: Treasury Bills - P 500,000 Money Market - P35,000 Short-term investments purchased within 3 months of maturity - P50,000 Investments to be held for 3 years - P300,000 Also, Gambit Company established a Php 20,000 petty cash fund by issuing a check to the custodian on January 1. On January 30, the petty cash fund was replenished and increased to Php 30,000 in total. The contents of the petty cash fund at the time of the January 30 replenishment were: Currency and coins P3,500 Petty cash receipts for: Transportation-in for inventory 2,000 Delivery expense. 3,000 Repairs to office equipment. Entertainment of customers. 5,000 6,000 The company uses the perpetual inventory method. The following information is available for the Gambit Company for the month of January. a. On January 30, after all transactions have been recorded, the balance in the company's Cash account has a balance of P894,000. b. The company's bank statement shows a balance on January 30 of P760,000. c. Outstanding checks at January 30 total P15,000. d. A deposit placed in the bank's night depository on January 30 totaling P58,000 did not appear on the bank statement. e. The bank collected P60,000 on a note receivable that is not yet recorded by Gambit Company. f. A P150,000 NSF check from a customer, is shown on the bank statement but not yet recorded by the company. g. Comparing the checks on the bank statement with the entries in the accounting records reveals that check #12345 for the payment of an account payable was correctly written for P656,000, but was recorded in the accounting records as P666,000. h. Included with the bank statement was a bank service charge in the amount of P10,000. It has not been recorded on the company's books. i. The bank charged P1,000 as fee for check collections. This has not been recorded on the company's books. Required: 1. Prepare Gambit's general journal entry to record both the reimbursement and the increase of the petty fund on January 30. 2. Prepare the January bank reconciliation for Gambit. 3. Prepare the general journal entries to bring the company's book balance of cash into conformity with the reconciled balance as of January 30. 4. How much is the the Cash and Cash Equivalents which should be presented in Gambit's Balance Sheet?
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