AUDIT TASK Make sure that the cash balance per bank shown on the bank reconciliation is verified by the bank Analyze the gross profit percentage with respect to previous period(s) and industry data Verify that the client has deeds or other proof of ownership for land and other plant assets Compare checks written in the weeks following the end of the fiscal period to amounts in accounts payable at period-end Consider payroll cost and expenses (in total and as a percentage of sales) for this period compared to prior period(s) Test the sales journal to establish that sales transactions actually took place and are reported in the proper period Compare the number of days' sales in accounts receivable (average collection period) from this period to prior period(s) Obtain an aged schedule of accounts receivable from period-end and verify the aging of the balances RELEVANT ASSERTION(S) Existence / Occurrence Completeness Cutoff Valuation & Allocation Rights & Obligation AUDIT EVIDENCE Physical Examination Inspection Observation Client Inquiry Confirmations Recalculation Reperformance Analytical Procedures

AUDIT TASK Make sure that the cash balance per bank shown on the bank reconciliation is verified by the bank Analyze the gross profit percentage with respect to previous period(s) and industry data Verify that the client has deeds or other proof of ownership for land and other plant assets Compare checks written in the weeks following the end of the fiscal period to amounts in accounts payable at period-end Consider payroll cost and expenses (in total and as a percentage of sales) for this period compared to prior period(s) Test the sales journal to establish that sales transactions actually took place and are reported in the proper period Compare the number of days' sales in accounts receivable (average collection period) from this period to prior period(s) Obtain an aged schedule of accounts receivable from period-end and verify the aging of the balances RELEVANT ASSERTION(S) Existence / Occurrence Completeness Cutoff Valuation & Allocation Rights & Obligation AUDIT EVIDENCE Physical Examination Inspection Observation Client Inquiry Confirmations Recalculation Reperformance Analytical Procedures

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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In the process of reconciling its bank statement for April, Donahue Enterprises' accountant compiles the following information: Cash balance per company books on April 30 Deposits in transit at month-end Outstanding checks at month-end Bank charge Note collected by bank on Donahue's behalf A check paid to Donahue during the month by a customer is returned by the bank as NSF The adjusted cash balance per the books on April 30 is: $6,275 $1,300 $ 620 $ 45 $770 $ 480
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Required:1. Prepare a bank reconciliation as of February 28.2. Prepare adjusting entries for Valentine based on the information developed in the bank reconciliation.3. What is the amount of cash that should be reported on the February 28 balance sheet?
Bank reconciliation and entries The following information was available to reconcile Nelson Company's book cash balance with its bank statement as of September 30, 2021: The September 30 cash balance according to the accounting records was $21,870. Oustanding checks from August's bank reconciliation: Check # 356 $1,240 Check # 357 775 Check # 359 3,280 Check # 360 924 Below is a record of the cash receipts and cash payments for September: Cash Deposits Cash Payments Date Amount Check# Amount Sep 2 $8,359 361 $3,268 Sep 4 11,250 362 7,140 Sep 6 4,371 363 4,257 Sep 12 5,260 364 3,525 Sep 15 12,118 365 4,160 Sep 18 7,493 366 1,789 Sep 22 5,395 367 6,285 Sep 27…
Mazaya Company gathered the following reconciling information in preparing its November bank reconciliation: Cash balance per books (11/30) R.O.4,400; Deposits in transit R.O. 6oo; Notes receivable and interest collected by bank R.O. 1,400; Bank charge for check printing
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Problem Solving. Required: 1. Prepare a properly classified bank reconciliation statement for each of the problems given below.2. Prepare the necessary adjusting journal entries on the company’s book for book reconciling items.
A. At July 31, Ramirez Company has the following bank information: cash balance per bank $8,039, outstanding checks $691, deposits in transit $1,163, and a bank service charge $26. Determine the adjusted cash balance per bank at July 31. B. Differences between when a company records a transaction and when the bank records the same transaction are called timing differences. True or False? C. When performing a bank reconciliation, checks outstanding are added back to the bank balance. True or False?