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Unformatted text preview: P7-1 Unique Globe, Inc.1. Bank Reconciliation2. Adjusting EntriesUnique Globe, Inc.31-May Cash$12,200.00 Bank ReconciliationNotes Receivable$12,000.00 May 31, 2010Interest Receivable$200.00 Notes & interest collected by bankBank balance, May 31$53,451.46 Add:31-May Cash$250.00 Deposits in transit$5,220.94 Interest Income$250.00 Bank charge deducted in error$750.00 $5,970.94 Interest posted by bank$59,422.40 Less: Checks outstanding$3,936.80 31-May Merchandise Inventory$540.00 Adjusted bank balance, May 31$55,485.60 Cash$540.00 Correct inventory purchase transactionUnadjusted book balance, May 31$43,784.16 Add:31-May Bank Service Charges Expense$30.00 Notes receivable collected by bank$12,000.00 Cash$30.00 Interest receivable collected by bank$200.00 Bank service charge for MayInterest posted on average balance$250.00 $12,450.00 $56,234.16 31-May Accounts Receivable$178.56 Less:Cash$178.56 Check recorded incorrectly in check register$540.00 ($1,920 - $1,380)NSF check from Eve Lay returnedBank service charge$30.00 NSF check from customer, Eve Lay$178.56 $748.56 3. Cash Balance, May 31Adjusted book balance, May 31$55,485.60 The cash balance for May 31 should be $55,485.60.4. CommentsA bank reconciliation is an important internal control process that allows the companyto monitor the integrity of its cash accounts. It also provides the company with an opportunity to determine the true cash balance for reporting purposes. Certain adjusting entries must be performed as a result of the bank reconciliation to bring affected ledgeraccount balances to the correct amounts.P7-2 Moore Company1. T Account AnalysisAccounts ReceivableAllowance for U/ABeginning balances$640,000 $33,400 a. Credit sales$2,104,000...
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This note was uploaded on 10/24/2011 for the course UGBA 102A taught by Professor Udpa during the Summer '07 term at University of California, Berkeley.
- Summer '07