Chapter 7 Cash and Receivables Soll - CHAPTER 7 Cash and Receivables*PROBLEM 7-13(a Jose Orozco Co Bank Reconciliation $4,150.00 2,890.00(2,136.05

Chapter 7 Cash and Receivables Soll - CHAPTER 7 Cash and...

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CHAPTER 7 Cash and Receivables *PROBLEM 7-13 (a) Jose Orozco Co. Bank Reconciliation June 30, 2007 Balance per bank, June 30 $4,150.00 Add: Deposits in transit 2,890.00 Deduct: Outstanding checks (2,136.05 ) Correct cash balance, June 30 $4,903.95 Balance per books, June 30 $3,969.85 Add: Error in recording deposit ($90 – $60) $ 30.00 Error on check no. 747 ($582.00 – $58.20) 523.80 Note collection ($900 + $36) 936.00 1,489.80 5,459.65 Deduct: NSF check 453.20 Error on check no. 742 ($491 – $419) 72.00 Bank service charges ($25 + $5.50) 30.50 (555.70 ) Correct cash balance, June 30 $4,903.95 (b) Cash ............................................................... 1,489.80 Accounts Receivable ............................. 30.00* Accounts Payable .................................. 523.80** Notes Receivable ................................... 900.00 Interest Revenue .................................... 36.00 Accounts Receivable ................................... 453.20 Accounts Payable ........................................ 72.00*** Office Expense—Bank Charges ................. 30.50 Cash ......................................................... 555.70 *Assumes sale was on account and not a cash sale.
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**Assumes that the purchase of the equipment was recorded at its proper price. If a straight cash purchase, then Equipment should be credited instead of Accounts Payable. ***If a straight cash purchase, then Equipment should be debited instead of Accounts Payable.
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