Oscar's Red Carpet Store maintains a checking account with Academy Bank. Oscar's sells carpet each day but makes bank deposits only once per week. The following provides information from the company's cash ledger for the month ending February 28, 2021. No. 321 322 323 324 Date 2/2 2/8 2/12 2/19 2/27 Amount $ 4,300 600 2,100 1,800 400 Date Amount $ 2,300 Checks: 1,900 2,800 3,700 1,200 $ 11,900 Deposits: 2/4 2/11 2/18 2/25 2/26-2/28 Cash receipts: 325 326 2/28 900 327 2/28 1,500 Balance on February 1 $ 6,400 $11,600 Receipts Disbursements 11,900 (11,600) $ 6,700 Balance on February 28 Information from February's bank statement and company records reveals the following additional information: a. The ending cash balance recorded in the bank statement is $10,390. b. Cash receipts of $1,200 from 2/26-2/28 are outstanding. c. Checks 325 and 327 are outstanding. d. The deposit on 2/11 includes a customer's check for $400 that did not clear the bank (NSF check). e. Check 323 was written for $2,800 for advertising in February. The bank properly recorded the check for this amount. f. An automatic withdrawal for Oscar's February rent was made on February 4 for $1,300. g. Oscar's checking account earns interest based on the average daily balance. The amount of interest earned for February is $160. h. In January, one of Oscar's suppliers, Titanic Fabrics, borrowed $5,200 from Oscar. On February 24, Titanic paid $5,350 ($5,200 borrowed amount plus $150 interest) directly to Academy Bank in payment for January's borrowing.
Oscar's Red Carpet Store maintains a checking account with Academy Bank. Oscar's sells carpet each day but makes bank deposits only once per week. The following provides information from the company's cash ledger for the month ending February 28, 2021. No. 321 322 323 324 Date 2/2 2/8 2/12 2/19 2/27 Amount $ 4,300 600 2,100 1,800 400 Date Amount $ 2,300 Checks: 1,900 2,800 3,700 1,200 $ 11,900 Deposits: 2/4 2/11 2/18 2/25 2/26-2/28 Cash receipts: 325 326 2/28 900 327 2/28 1,500 Balance on February 1 $ 6,400 $11,600 Receipts Disbursements 11,900 (11,600) $ 6,700 Balance on February 28 Information from February's bank statement and company records reveals the following additional information: a. The ending cash balance recorded in the bank statement is $10,390. b. Cash receipts of $1,200 from 2/26-2/28 are outstanding. c. Checks 325 and 327 are outstanding. d. The deposit on 2/11 includes a customer's check for $400 that did not clear the bank (NSF check). e. Check 323 was written for $2,800 for advertising in February. The bank properly recorded the check for this amount. f. An automatic withdrawal for Oscar's February rent was made on February 4 for $1,300. g. Oscar's checking account earns interest based on the average daily balance. The amount of interest earned for February is $160. h. In January, one of Oscar's suppliers, Titanic Fabrics, borrowed $5,200 from Oscar. On February 24, Titanic paid $5,350 ($5,200 borrowed amount plus $150 interest) directly to Academy Bank in payment for January's borrowing.
College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:Scott, Cathy J.
Chapter6: Bank Accounts, Cash Funds, And Internal Controls
Section: Chapter Questions
Problem 4PA
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Transcribed Image Text:Oscar's Red Carpet Store maintains a checking account with Academy Bank. Oscar's sells carpet each day but makes
bank deposits only once per week. The following provides information from the company's cash ledger for the month
ending February 28, 2021.
Date
2/4
2/11
2/18
2/25
2/26-2/28
No.
321
322
323
324
Amount
Date
Amount
$2,300 Checks:
1,900
2,800
3,700
1,200
$ 11,900
$ 4,300
600
Deposits:
2/2
2/8
2/12
2/19
2/27
2,100
1,800
400
Cash receipts:
325
326
2/28
900
1,500
$11,600
327
2/28
Balance on February 1
$ 6,400
Receipts
Disbursements
11,900
(11,600)
$ 6,700
Balance on February 28
Information from February's bank statement and company records reveals the following additional information:
a. The ending cash balance recorded in the bank statement is $10,390.
b. Cash receipts of $1,200 from 2/26-2/28 are outstanding.
c. Checks 325 and 327 are outstanding.
d. The deposit on 2/11 includes a customer's check for $400 that did not clear the bank (NSF check).
e. Check 323 was written for $2,800 for advertising in February. The bank properly recorded the check for this amount.
f. An automatic withdrawal for Oscar's February rent was made on February 4 for $1,300.
g. Oscar's checking account earns interest based on the average daily balance. The amount of interest earned for
February is $160.
h. In January, one of Oscar's suppliers, Titanic Fabrics, borrowed $5,200 from Oscar. On February 24, Titanic paid $5,350
($5,200 borrowed amount plus $150 interest) directly to Academy Bank in payment for January's borrowing.
Transcribed Image Text:2. Record the necessary cash adjustments. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the
first account field. Total entries to the same account together when entering in the journal entry worksheet.)
View transaction list
Journal entry worksheet
1
>
Record the amounts that decrease cash.
Note: Enter debits before credits.
Transaction
General Journal
Debit
Credit
Expert Solution
Step 1
Journal Entry:- These are prepared by the companies with debit and credit sides in order to match the accounts. Transactions recorded in Journal first then posted to ledger accounts.
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