During July the cash transactions and cash balances of Rapid Harvest were as follows: 1. The cash balance per the bank statement at July 31 was $28,945.27 2. The ledger account for Cash had a balance at July 31 of $26,686.95. 3. Cash receipts on July 31 amounted to $4,000. These cash receipts were left at the bank in the night depository chute alter banking hours on-July 31 and therefore were not included by the bank in the July bank statement. 4. Included with the July bank statement was a credit memorandum showing interest earned by the depositor on this account in the amount of $80. 5. Another credit memorandum enclosed with the July bank statement showed that a non- interest-bearing note for $3, 663 from Ralph Warde, left with the bank for collection, had been collected and the proceeds credited to the account of Rapid Harvest. 6. Also included with the July bank statement was a debit memorandum from the bank, for $19.45 representing service charges for July. 7. Comparison of the paid checks returned by the bank with the entries in the ' accounting records revealed that check no. 922 for $4, 521. 50 issued July 15 in payment for salaries expense had been erroneously entered' 1n the accounting records as $5, 421.50 8. Examination of the paid checks also revealed that three checks, all issued in July, had not yet been paid by the bank: no. 921 for $944.32; no. 924 for $320.50; no. 935 for $538.15. 9. Included with the July bank statement was a $168. 20 check drawn by Edward Jones, a customer of Rapid Harvest. This check was marked “NSF” It had been included' 1n the deposit of July 27 but had been charged back against the company’s account on July 31. Instruction: a. Prepare bank reconciliation for Rapid Harvest at July 81. b. Prepare journal entries (in general journal form) to adjust the accounts at July 31; Assume that the accounts have not been closed c. State the amount of cash which should be included' 1n the balance sheet at July 31.

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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Question

During July the cash transactions and cash balances of Rapid Harvest were as follows:

1. The cash balance per the bank statement at July 31 was $28,945.27

2. The ledger account for Cash had a balance at July 31 of $26,686.95.

3. Cash receipts on July 31 amounted to $4,000. These cash receipts were left at the bank in

the night depository chute alter banking hours on-July 31 and therefore were not included

by the bank in the July bank statement.

4. Included with the July bank statement was a credit memorandum showing interest earned

by the depositor on this account in the amount of $80.

5. Another credit memorandum enclosed with the July bank statement showed that a non-

interest-bearing note for $3, 663 from Ralph Warde, left with the bank for collection, had

been collected and the proceeds credited to the account of Rapid Harvest.

6. Also included with the July bank statement was a debit memorandum from the bank, for

$19.45 representing service charges for July.

7. Comparison of the paid checks returned by the bank with the entries in the ' accounting

records revealed that check no. 922 for $4, 521. 50 issued July 15 in payment for salaries

expense had been erroneously entered' 1n the accounting records as $5, 421.50

8. Examination of the paid checks also revealed that three checks, all issued in July, had not

yet been paid by the bank: no. 921 for $944.32; no. 924 for $320.50; no. 935 for $538.15.

9. Included with the July bank statement was a $168. 20 check drawn by Edward Jones, a

customer of Rapid Harvest. This check was marked “NSF” It had been included' 1n the

deposit of July 27 but had been charged back against the company’s account on July 31.

Instruction:

a. Prepare bank reconciliation for Rapid Harvest at July 81.

b. Prepare journal entries (in general journal form) to adjust the accounts at July 31;

Assume that the accounts have not been closed

c. State the amount of cash which should be included' 1n the balance sheet at July 31.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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