Financial Accounting
3rd Edition
ISBN: 9780133791129
Author: Jane L. Reimers
Publisher: Pearson Higher Ed
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Chapter 4, Problem 35EB
To determine
Prepare a bank reconciliation of Company R as at August 31.
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Question: The following errors were found when the controller at Mountain Motel was doing the June 30 bank reconciliation.
On June 25, the bank posted a cheque in the amount of $825 to Mountain’s bank account. The cheque had been written by another company, Mountainside Company.
For each of these errors, (a) indicate if and how it would be shown on the bank reconciliation, and (b) prepare the journal entry for Mountain if required.
Please explain for the answer.
prepare journal entries for this
The following errors were found when the controller at Crane Hotel was doing the March 31 bank reconciliation.
1.
2.
3.
On March 5, Crane recorded a payment of an account payable as $2,710. The correct amount was $1,270. It was correctly
recorded by the bank.
On March 19, Crane recorded a deposit as $2,820. The correct amount was $4,280. The deposit was for the collection of an
account receivable and the bank recorded it correctly.
On March 31, the bank recorded a deposit as $5,610. The correct amount was $2,650. This error was corrected by the bank
on April 1. Crane had correctly recorded the deposit.
For each of these errors indicate if and how it would be shown on the bank reconciliation.
1.
2.
3.
$
$
+A
The bank mistakenly withdraws a check amounting $75,000 on thecompany’s account. What is the journal entry to correct the bank record?
Chapter 4 Solutions
Financial Accounting
Ch. 4 - Prob. 1YTCh. 4 - Prob. 2YTCh. 4 - Suppose at the end of the year Pendleton Corp.s...Ch. 4 - Prob. 4YTCh. 4 - Prob. 5YTCh. 4 - Prob. 6YTCh. 4 - Prob. 7YTCh. 4 - Prob. 1QCh. 4 - Prob. 2QCh. 4 - Prob. 3Q
Ch. 4 - Prob. 4QCh. 4 - What does true cash balance refer to?Ch. 4 - Identify and explain the financial statements on...Ch. 4 - Describe how accounts receivable arise. What does...Ch. 4 - Prob. 8QCh. 4 - Define net realizable value, book value, and...Ch. 4 - Explain the difference between the direct...Ch. 4 - If a company uses the allowance method of...Ch. 4 - Describe the two allowance methods used to...Ch. 4 - Which method of calculating the allowance for...Ch. 4 - Which method of calculating the allowance for...Ch. 4 - What are the advantages and disadvantages of...Ch. 4 - What is the difference between accounts receivable...Ch. 4 - What is the formula to calculate the accounts...Ch. 4 - How does a firm use its accounts receivable...Ch. 4 - Prob. 19QCh. 4 - Prob. 20QCh. 4 - Prob. 1MCQCh. 4 - Prob. 2MCQCh. 4 - Prob. 3MCQCh. 4 - Prob. 4MCQCh. 4 - Prob. 5MCQCh. 4 - Prob. 6MCQCh. 4 - Prob. 7MCQCh. 4 - Prob. 8MCQCh. 4 - Prob. 9MCQCh. 4 - Prob. 1SEACh. 4 - Prob. 2SEACh. 4 - Prob. 3SEACh. 4 - Prob. 4SEACh. 4 - Prob. 5SEACh. 4 - Prob. 6SEACh. 4 - Prob. 7SEACh. 4 - Prob. 8SEACh. 4 - Prob. 9SEACh. 4 - Prob. 10SEBCh. 4 - Prob. 11SEBCh. 4 - Prob. 12SEBCh. 4 - Prob. 13SEBCh. 4 - Prob. 14SEBCh. 4 - Prob. 15SEBCh. 4 - Prob. 16SEBCh. 4 - Prob. 17SEBCh. 4 - Prob. 18SEBCh. 4 - Prob. 19EACh. 4 - Prob. 20EACh. 4 - Prob. 21EACh. 4 - Prob. 22EACh. 4 - Prob. 23EACh. 4 - Prob. 24EACh. 4 - Prob. 25EACh. 4 - Prob. 26EACh. 4 - Prob. 27EACh. 4 - Prob. 28EACh. 4 - Prob. 29EACh. 4 - Prob. 30EACh. 4 - Prob. 31EACh. 4 - Prob. 32EBCh. 4 - Prob. 33EBCh. 4 - Prob. 34EBCh. 4 - Prob. 35EBCh. 4 - Prob. 36EBCh. 4 - Prob. 37EBCh. 4 - Prob. 38EBCh. 4 - Prob. 39EBCh. 4 - Prob. 40EBCh. 4 - Prob. 41EBCh. 4 - Prob. 42EBCh. 4 - Prob. 43EBCh. 4 - Prob. 44EBCh. 4 - Prob. 45PACh. 4 - Prob. 46PACh. 4 - Prob. 47PACh. 4 - Prob. 48PACh. 4 - Prob. 49PACh. 4 - Prob. 50PACh. 4 - Prob. 51PACh. 4 - Prob. 52PACh. 4 - Prob. 53PBCh. 4 - Prob. 54PBCh. 4 - Prob. 55PBCh. 4 - Prob. 56PBCh. 4 - Prob. 57PBCh. 4 - Prob. 58PBCh. 4 - Prob. 59PBCh. 4 - Prob. 60PBCh. 4 - Prob. 1FSACh. 4 - Prob. 2FSACh. 4 - The following information has been adapted from...Ch. 4 - Prob. 1CTPCh. 4 - Prob. 2CTPCh. 4 - The information given here was taken from Yahoo!...Ch. 4 - Prob. 1IECh. 4 - Prob. 2IECh. 4 - The information given here was taken from Yahoo!...
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- The bank reconciliation revealed that one deposit had cleared the bank two weeks after the date of the deposit. Should this be of concern? Why, or why not?arrow_forwardIn comparing the canceled checks on the bank statement with the entries in the accounting records, Tanner Company found that check number 4239 for May's rent was correctly written and drawn for $6,750 but was erroneously entered in the accounting records as $6,570. When preparing the May bank reconciliation, the Tanner Company should: Select one: A. Add $180 to the book balance of cash B. Deduct $180 from the bank statement balance C. Add $180 to the bank statement balance D. Deduct $180 from the book balance of casharrow_forwardMelissa Jackson, bookkeeper for Kinko Company, cannot prepare a bank reconciliation. The bank statement showed a $3,567.87 balance. Melissa's checkbook showed a $3,687.12 balance. Melissa placed a $559.80 deposit in the bank's night depository on June 30. The deposit did not appear on the bank statement. The bank included two DMs and one CM with the returned checks: $736.45 DM for NSF check, $10.40 DM for service charges, and $429.90 CM (less $14.00 collection fee) for collecting a $429.90 non-interest-bearing note. Check No. 811 for $178.70 and check No. 912 for $172.30, both written and recorded on June 28, were not with the returned checks. The bookkeeper had correctly written check No. 884, $1,325.00, for a new cash register, but she recorded the check as $1,440.00. The May bank reconciliation showed check No. 748 for $305.50 and check No. 710 for $223.60 as outstanding. The June bank statement included check No. 710 but not check No. 748. Complete the June 30, 2015,…arrow_forward
- The following errors were found when the controller at Crane Hotel was doing the March 31 bank reconciliation. 1. 2. 3. On March 5, Crane recorded a payment of an account payable as $2,710. The correct amount was $1,270. It was correctly recorded by the bank. On March 19, Crane recorded a deposit as $2,820. The correct amount was $4,280. The deposit was for the collection of an account receivable and the bank recorded it correctly. On March 31, the bank recorded a deposit as $5,610. The correct amount was $2,650. This error was corrected by the bank on April 1. Crane had correctly recorded the deposit. For each of these errors indicate if and how it would be shown on the bank reconciliation. 1. 2. 3. $ $ $arrow_forwardMelissa Jackson, bookkeeper for Kinko Company, cannot prepare a bank reconciliation. The bank statement showed a $3,248.87 balance. Melissa's checkbook showed a $3,420.12 balance. Melissa placed a $522.80 deposit in the bank's night depository on June 30. The deposit did not appear on the bank statement. The bank included two DMs and one CM with the returned checks: $887.05 DM for NSF check, $13.60 DM for service charges, and $488.30 CM (less $18.00 collection fee) for collecting a $488.30 non-interest-bearing note. Check No. 811 for $143.10 and check No. 912 for $109.50, both written and recorded on June 28, were not with the returned checks. The bookkeeper had correctly written check No. 884, $1,310.00, for a new cash register, but she recorded the check as $1,472.00. The May bank reconciliation showed check No. 748 for $367.30 and check No. 710 for $251.30 as outstanding. The June bank statement included check No. 710 but not check No. 748. Complete the June 30, 2015,…arrow_forwardWhile performing its monthly bank reconciliation, XYZ Inc. discovered that it recorded a cash receipt from a customer for an incorrect amount. The company debited “Cash” and credited “Sales Revenue” for $920 instead of $290. On its bank reconciliation, how should the company adjust for this error? Add $630 to the company (book) side. Subtract $630 from the company (book) side. Add $630 to the bank side. Subtract $630 from the bank side.arrow_forward
- Assume you are doing a Bank Reconciliation. The bank balance at end of a month is $0 and the Book balance for same date is $150. Based on the the following two partial transactions, find what is the reconciling DIFFERENCE: (a) Bank made an error of $200 by clearing a cheque in the amount of $600 instead of the correct amount of $400. (b) Book also made an error of recording an entry incorrectly, i.e. it recorded a deposit of $50 incorrectly as $125. Please solve this questionarrow_forwardUsing the following information, prepare a bank reconciliation. Bank balance: $6,788 Book balance: $6,525 Deposits in transit: $1,688 Outstanding checks: $569 and $1,523 Bank charges: $75 Bank incorrectly charged the account $75. The bank will correct the error next month. Check number 2456 correctly cleared the bank in the amount of $245 but posted in the accounting records as $254. This check was expensed to Utilities Expense. Bank Reconciliation Bank Statement Balance at (date) $fill in the blank 1 Add: Deposits in Transit Outstanding Checks Less: - Select - Adjusted Bank Balance $fill in the blank 8 Book Balance at (date) $fill in the blank 9 Add: - Select - Less: - Select - Adjusted Book Balance $fill in the blank 14arrow_forwardAnalyze the following errors that appeared on Black Electric’s bank statement and in the accounting records: a. The bank recorded a deposit of $30 as $300. b. The company’s bookkeeper mistakenly recorded a deposit of $250 as $520. c. The company’s bookkeeper mistakenly recorded a payment of $450 received from a customer as $540 on the bank deposit slip. The bank caught the error and made the deposit for the correct amount. d. The bank statement shows a check that was written by the company for $392 was erroneously paid (cleared the account) as $329. e. The bookkeeper wrote a check for $275 but erroneously wrote down $257 as the cash disbursement in the company’s records. Requirement For each error, describe how the correction would be shown on the company’s bank reconciliation.arrow_forward
- Using the following information, prepare a bank reconciliation. Bank balance: $6,788 Book balance: $6,246 Deposits in transit: $1,600 Outstanding checks: $579 and $1,523 Bank charges: $25 Bank incorrectly charged the account $25. The bank will correct the error next month. Check number 2456 correctly cleared the bank in the amount of $123 but posted in the accounting records as $213. This check was expensed to Utilities Expense.arrow_forwardFor which of the following errors would the appropriate amount be subtracted from the balance per books on a bank reconciliation? Deposit of $200 recorded by the bank as $20. A returned $100 check recorded by the bank as $10. Check written for $63, but recorded by the company as $36. Check written for $59, but recorded by the company as $95.arrow_forwardWhen making a Bank Reconciliation. I am giving these two pieces of information. A collection from a customer (T. Kelsey) recorded on the books on October 25, 2020 was recorded at $2,585.39. The actual amount collected from the customer was $2,855.39. Check number 10120 written and mailed on October 25, 2020 was actually written for $645.84. The company accountant miskeyed the amount into the books at $445.84. What would they look like on a Back rec? Which side would they be on (bank or book) and would they be an addition or subtraction?arrow_forward
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