CHART OF ACCOUNTS Norwegian Medical Co. General Ledger ASSETS 110 Cash 111 Petty Cash 120 Accounts Receivable f. 131 Notes Receivable 141 Merchandise Inventory 145 Office Supplies 146 Store Supplies 151 Prepaid Insurance 181 Land 191 Office Equipment 192 Accumulated Depreciation-Office Equipment 193 Store Equipment 194 Accumulated Depreciation-Store Equipment LIABILITIES 211 Accounts Payable-Universal Supply Co. 221 Notes Payable 222 Interest Payable 231 Salaries Payable 241 Sales Tax Payable EQUITY 310 Owner, Capital 311 Owner, Drawing REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Merchandise Sold 515 Credit Card Expense 516 Cash Short and Over 520 Salaries Expense 531 Advertising Expense 532 Delivery Expense 533 Insurance Expense 534 535 Rent Expense 536 Repairs Expense 537 Selling Expenses 538 Store Supplies Expense Office Supplies Expense 561 Depreciation Expense-Office Equipment 562 Depreciation Expense-Store Equipment 590 Miscellaneous Expense 710 Interest Expense The cash account for Norwegian Medical Co. at April 30 indicated a balance of $93,115. The bank statement indicated a balance of $125,800 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items: a. Checks outstanding totaled $30,060. b. A deposit of $19,240, representing receipts of April 30, had been made too late to appear on the bank statement. c. The bank collected $24,075 on a $22,500 note, including interest of $1,575. d. A check for $1,800 returned with the statement had been incorrectly recorded by Norwegian Medical Co. as $180. The check was for the payment of an obligation to Universal Supply Co. for a purchase on account. e. A check drawn for $390 had been erroneously charged by the bank as $930. Bank service charges for April amounted to $50. Required: Prepare a bank reconciliation. Be sure to complete the statement heading. Refer to the Labels and Amount 1. Descriptions for the exact wording of text entries. "Add:" or "Deduct:" will automatically appear if it is required. Enter all amounts as positive numbers. 2. Journalize the necessary entries. The accounts have not been closed. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. 3. If a balance sheet is prepared for Norwegian Medical Co. on April 30, what amount should be reported as cash?

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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CHART OF ACCOUNTS
Norwegian Medical Co.
General Ledger
C.
e.
110 Cash
f.
111 Petty Cash
1.
ASSETS
120 Accounts Receivable
131 Notes Receivable
141 Merchandise Inventory
145 Office Supplies
146 Store Supplies
151 Prepaid Insurance
181 Land
191 Office Equipment
192 Accumulated Depreciation-Office Equipment
193 Store Equipment
194 Accumulated Depreciation-Store Equipment
LIABILITIES
211 Accounts Payable-Universal Supply Co.
221 Notes Payable
222 Interest Payable
231 Salaries Payable
241 Sales Tax Payable
EQUITY
Owner, Capital
311 Owner, Drawing
REVENUE
410 Sales
610 Interest Revenue
510
The cash account for Norwegian Medical Co. at April 30 indicated a balance of $93,115. The bank statement indicated a
balance of $125,800 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with
the records revealed the following reconciling items:
a. Checks outstanding totaled $30,060.
Cost of Merchandise Sold
515
Credit Card Expense
516
Cash Short and Over
520
Salaries Expense
531 Advertising Expense
532 Delivery Expense
533 Insurance Expense
534 Office Supplies Expense
535 Rent Expense
536
Repairs Expense
537 Selling Expenses
538 Store Supplies Expense
b.
A deposit of $19,240, representing receipts of April 30, had been made too late to appear on the bank statement.
The bank collected $24,075 on a $22,500 note, including interest of $1,575.
d.
A check for $1,800 returned with the statement had been incorrectly recorded by Norwegian Medical Co. as $180.
The check was for the payment of an obligation to Universal Supply Co. for a purchase on account.
EXPENSES
561 Depreciation Expense-Office Equipment
562 Depreciation Expense-Store Equipment
590 Miscellaneous Expense
710
Interest Expense
A check drawn for $390 had been erroneously charged by the bank as $930.
Bank service charges for April amounted to $50.
Required:
Prepare a bank reconciliation. Be sure to complete the statement heading. Refer to the Labels and Amount
Descriptions for the exact wording of text entries. "Add:" or "Deduct:" will automatically appear if it is required. Enter
all amounts as positive numbers.
2.
Journalize the necessary entries. The accounts have not been closed. Refer to the chart of accounts for the exact
wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page
is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is
entered.
3. If a balance sheet is prepared for Norwegian Medical Co. on April 30, what amount should be reported as cash?
Transcribed Image Text:CHART OF ACCOUNTS Norwegian Medical Co. General Ledger C. e. 110 Cash f. 111 Petty Cash 1. ASSETS 120 Accounts Receivable 131 Notes Receivable 141 Merchandise Inventory 145 Office Supplies 146 Store Supplies 151 Prepaid Insurance 181 Land 191 Office Equipment 192 Accumulated Depreciation-Office Equipment 193 Store Equipment 194 Accumulated Depreciation-Store Equipment LIABILITIES 211 Accounts Payable-Universal Supply Co. 221 Notes Payable 222 Interest Payable 231 Salaries Payable 241 Sales Tax Payable EQUITY Owner, Capital 311 Owner, Drawing REVENUE 410 Sales 610 Interest Revenue 510 The cash account for Norwegian Medical Co. at April 30 indicated a balance of $93,115. The bank statement indicated a balance of $125,800 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items: a. Checks outstanding totaled $30,060. Cost of Merchandise Sold 515 Credit Card Expense 516 Cash Short and Over 520 Salaries Expense 531 Advertising Expense 532 Delivery Expense 533 Insurance Expense 534 Office Supplies Expense 535 Rent Expense 536 Repairs Expense 537 Selling Expenses 538 Store Supplies Expense b. A deposit of $19,240, representing receipts of April 30, had been made too late to appear on the bank statement. The bank collected $24,075 on a $22,500 note, including interest of $1,575. d. A check for $1,800 returned with the statement had been incorrectly recorded by Norwegian Medical Co. as $180. The check was for the payment of an obligation to Universal Supply Co. for a purchase on account. EXPENSES 561 Depreciation Expense-Office Equipment 562 Depreciation Expense-Store Equipment 590 Miscellaneous Expense 710 Interest Expense A check drawn for $390 had been erroneously charged by the bank as $930. Bank service charges for April amounted to $50. Required: Prepare a bank reconciliation. Be sure to complete the statement heading. Refer to the Labels and Amount Descriptions for the exact wording of text entries. "Add:" or "Deduct:" will automatically appear if it is required. Enter all amounts as positive numbers. 2. Journalize the necessary entries. The accounts have not been closed. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. 3. If a balance sheet is prepared for Norwegian Medical Co. on April 30, what amount should be reported as cash?
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