On December 31, 2020 Buttercup Company had a cash balance per books of $10,922.25. The bank statement from Tampa Savings Bank on that date showed a balance of $10,356.90. A comparison of statement with the cash account revealed the following facts: a. Deposits in transit were$11,663.10.10. b. Outstanding checks at December 31 totaled $1,750.875. c. On December 31, the bank statement showed on NSF charge of 1006.50 for a check issued by Charlie Holston, a customer, to Buttercup Company on account. d. A $5,383.50 note receivable was collected by the bank for buttercup Company. The bank charged a collection fee of $43.50. e. Cash sales of $1,474.50 on December 20 were deposited in the bank. The cash receipts journal entry and the deposit slip were incorrectly made for $1,399.50. The bank credited Buttercup Company for the correct amount. f. A $3,750 note receivable was collected by the bank for Bollywood Company. The bank charged a collection fee of $26.625. However the bank incorrectly credited the collected amount and charged the collection fee from Buttercup Company. g. A $1,250 note receivable was collected by the bank for Buttercup Company. However the bank incorrectly credited the collected amount and charged a collection fee of $ 35.50 from Bollywood Company.
On December 31, 2020 Buttercup Company had a cash balance per books of $10,922.25. The bank statement from Tampa Savings Bank on that date showed a balance of $10,356.90. A comparison of statement with the cash account revealed the following facts: a. Deposits in transit were$11,663.10.10. b. Outstanding checks at December 31 totaled $1,750.875. c. On December 31, the bank statement showed on NSF charge of 1006.50 for a check issued by Charlie Holston, a customer, to Buttercup Company on account. d. A $5,383.50 note receivable was collected by the bank for buttercup Company. The bank charged a collection fee of $43.50. e. Cash sales of $1,474.50 on December 20 were deposited in the bank. The cash receipts journal entry and the deposit slip were incorrectly made for $1,399.50. The bank credited Buttercup Company for the correct amount. f. A $3,750 note receivable was collected by the bank for Bollywood Company. The bank charged a collection fee of $26.625. However the bank incorrectly credited the collected amount and charged the collection fee from Buttercup Company. g. A $1,250 note receivable was collected by the bank for Buttercup Company. However the bank incorrectly credited the collected amount and charged a collection fee of $ 35.50 from Bollywood Company.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On December 31, 2020 Buttercup Company had a cash balance per books of $10,922.25. The bank statement from
Tampa Savings Bank on that date showed a balance of $10,356.90. A comparison of statement with the cash account
revealed the following facts:
a. Deposits in transit were$11,663.10.10.
b. Outstanding checks at December 31 totaled $1,750.875.
c. On December 31, the bank statement showed on NSF charge of 1006.50 for a check issued by Charlie Holston, a
customer, to Buttercup Company on account.
d. A $5,383.50 note receivable was collected by the bank for buttercup Company. The bank charged a collection fee
of $43.50.
e. Cash sales of $1,474.50 on December 20 were deposited in the bank. The cash receipts journal entry and the
deposit slip were incorrectly made for $1,399.50. The bank credited Buttercup Company for the correct amount.
f. A $3,750 note receivable was collected by the bank for Bollywood Company. The bank charged a collection fee of
$26.625. However the bank incorrectly credited the collected amount and charged the collection fee from
Buttercup Company.
g. A $1,250 note receivable was collected by the bank for Buttercup Company. However the bank incorrectly
credited the collected amount and charged a collection fee of $ 35.50
from Bollywood Company.
Required:
a. Prepare the bank reconciliation statement dated December 31 2020, proceeding to a correct cash balance.
b. Prepare any entries necessary to make the books correct and complete.
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