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CH10+Lesson+pp.ppt - Cash Controls 1 Apply cash controls...

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Cash Controls
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1. Apply cash controls Record cash immediately when it is received. Protect cash when it is on the premises. Remove cash from the premises as soon as possible.
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2.Prepare journal entries for cash rounding, debit and credit transactions -round cash transactions to the nearest nickel -If “Cash Over and Short” account has a debit balance at end of period, it is reported as an expense. If credit, it’s reported as a Revenue -charged either a per transaction or a flat fee for debit/credit card sales Example: 2.5% per transaction or 2% of total sales AP-16A,17A
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3. Prepare a bank reconciliation and the related journal entries 2012 Cash #101 Date Explanation Debit Balanc e Jan 1 Opening Balance Jan 6 Cheque #101 Jan 10 Cheque #102 1,000 6,500 Jan 11 Deposit 250 6,750 Jan 14 Cheque #103 757 5,993 Jan 19 Cheque #104 840 5,153 Jan 31 Deposit 2,500 7,653 BANK STATEMENT Date Explanation Withdrawal Deposit Balance Jan 1 Opening Balance 8,000 Jan 6 Cheque #101 500 7,500 Jan 10 Cheque #102 1,000 6,500 Jan 10 EFT monthly rent 800 5,700 Jan 11 Deposit 250 5,950 Jan 11 NSF Cheque 250 5,700 Jan 11 NSF Charge 5 5,695 Jan 14 Cheque #103 575 5,120 Jan 21 Cheque # 1520 3,000 2,120 Jan 30 Service Charges 25 2,095 Jan 31 Interest on Bank Account 20 2,115 Totals 6,155 270 2012 Cash #101 Date
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