On 30 June 2016, the cash at bank account for Holmes Traders showed a debit balance of $13,398 and the bank statement showed a credit balance of 20,008. A comparison of the two sets of records disclosed: that there was a bank service fee of $10 the bank had collected $1000 on behalf of Holmes Traders on the maturity of a note unpresented cheques totalling $8340 that the date of a deposit of $2740 was shown by Holmes Traders as 30 June 2016, whereas the bank did not record the deposit until 1 July 2016 the bank statement shows interest received on bank account, $20 Required: 1.Prepare the bank reconciliation statement for Holmes Traders for the month ended at 30 June 2016. 2.Do you agree with the statement: “Internal control of cash is strengthened by requiring that each day’s receipts are deposited intact and that all payments are made by cheque or electronic transfer”? Discuss.
On 30 June 2016, the cash at bank account for Holmes Traders showed a debit balance of $13,398 and the bank statement showed a credit balance of 20,008. A comparison of the two sets of records disclosed: that there was a bank service fee of $10 the bank had collected $1000 on behalf of Holmes Traders on the maturity of a note unpresented cheques totalling $8340 that the date of a deposit of $2740 was shown by Holmes Traders as 30 June 2016, whereas the bank did not record the deposit until 1 July 2016 the bank statement shows interest received on bank account, $20 Required: 1.Prepare the bank reconciliation statement for Holmes Traders for the month ended at 30 June 2016. 2.Do you agree with the statement: “Internal control of cash is strengthened by requiring that each day’s receipts are deposited intact and that all payments are made by cheque or electronic transfer”? Discuss.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
On 30 June 2016, the cash at bank account for Holmes Traders showed a debit balance of $13,398 and the bank statement showed a credit balance of 20,008. A comparison of the two sets of records disclosed:
- that there was a bank service fee of $10
- the bank had collected $1000 on behalf of Holmes Traders on the maturity of a note
- unpresented cheques totalling $8340
- that the date of a deposit of $2740 was shown by Holmes Traders as 30 June 2016, whereas the bank did not record the deposit until 1 July 2016
- the bank statement shows interest received on bank account, $20
Required:
1.Prepare the
2.Do you agree with the statement: “Internal control of cash is strengthened by requiring that each day’s receipts are deposited intact and that all payments are made by cheque or electronic transfer”? Discuss.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education