Question1 The following relates toTimâ??s Business entity, not Tim theowner. Timâ??s business prepar

Question1 The following relates toTimâ??s Business entity, not Tim theowner. Timâ??s business prepar

Question1

The following
relates toTim’s Business entity,
not Tim theowner. Tim’s business
preparesmonthlybank reconciliations of
his chequeaccount balance.
The
bankstatementforAugust
2015 indicated the
following:

Balance,
August
31, 2015

$7,920

Bank servicecharges forAugust

20

Interest earned
during
August

30

NSF (bounced)
chequefrom a
customerpreviouslydeposited
by
Tim

32

Collection
ofnote ($1,000) and therelated interest
($40) from customer

1,040

An analysis of
cancelledcheques and
deposits
and
the records
ofTim revealed the
following items:

Cheque account balanceperTim’s
accounting
recordsAugust 31

$7,170

Outstandingcheques as
of
August 31

952

Deposits
in transit on August 31

1,310

Errorin recordingcheque#
247 issued byTim

90

The correct amount
ofcheque# 247 is $340, but it was recordedas
acash disbursement of
$430. The chequewas
issued
to payforinventorypurchased. The chequewas written correctlyand
appeared on
the
bank statement correctlyit
was
just recordedin
Tim’s Business accountingrecords incorrectly.

Required

A)

Prepareabank reconciliation
in proper form for August
31, 2015.

B)

What amount would Timreport his cash
balancein the
statement of financialposition (balancesheet)at August
31, 2015?

C)

Record thetransaction
(adjustments)
Tim will need as a
result ofthis bank reconciliation
process?

D) Howdoesthepreparationofbankreconciliationsaidininternalcontrol?

Looking for a similar assignment? Get help from our qualified experts!

Order Now

Related Posts