Question 17 The following information is available to reconcile Gulf Company's cash book balance with its bank statement balance as of December 31, 2019. i. On Dec 31, the company's cash account has a $5,400 debit balance, but its December's bank statement shows a balance of $6,500. ii. Check No. 0121 for $1,054 and Check No. 0142 for $766 were issued by Gulf Company but were still outstanding for the payment by the bank on December 315t 111. Branch's December 31st daily cash receipts of $4,000 were placed in the bank's night depository on that date but do not appear on the December 31st bank statement. iv. A credit memorandum enclosed with the December bank statement indicates the bank collected directly an interest amounting $4,540 in cash on a long-term note and credited in its account. Gulf Company had not recorded this transaction in the cash book before receiving the statement. v.A debit memorandum for $1,200 lists a NSF (Not Sufficient Fund) check. The check had been received from a customer, Saeed. Gulf Company has not yet recorded this check as NSF. vi. Enclosed with the December statement is a $60 debit memorandum for bank services charges. It has not yet been recorded in cash book because no previous notification had been received. Required: Prepare a bank reconciliation statement showing an adjusted balance in the cash book.
Question 17 The following information is available to reconcile Gulf Company's cash book balance with its bank statement balance as of December 31, 2019. i. On Dec 31, the company's cash account has a $5,400 debit balance, but its December's bank statement shows a balance of $6,500. ii. Check No. 0121 for $1,054 and Check No. 0142 for $766 were issued by Gulf Company but were still outstanding for the payment by the bank on December 315t 111. Branch's December 31st daily cash receipts of $4,000 were placed in the bank's night depository on that date but do not appear on the December 31st bank statement. iv. A credit memorandum enclosed with the December bank statement indicates the bank collected directly an interest amounting $4,540 in cash on a long-term note and credited in its account. Gulf Company had not recorded this transaction in the cash book before receiving the statement. v.A debit memorandum for $1,200 lists a NSF (Not Sufficient Fund) check. The check had been received from a customer, Saeed. Gulf Company has not yet recorded this check as NSF. vi. Enclosed with the December statement is a $60 debit memorandum for bank services charges. It has not yet been recorded in cash book because no previous notification had been received. Required: Prepare a bank reconciliation statement showing an adjusted balance in the cash book.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Question 17
The following information is available to reconcile Gulf Company's cash book balance with its bank statement balance as of December 31, 2019.
1. On Dec 31, the company's cash account has a $5,400 debit balance, but its December's bank statement shows a balance of S6,500.
ii. Check No. 0121 for $1,054 and Check No. 0142 for $766 were issued by Gulf Company but were still outstanding for the payment by the bank on December 31st.
111. Branch's December 31st daily cash receipts of $4,000 were placed in the bank's night depository on that date but do not appear on the December 31st bank statement.
iv. A credit memorandum enclosed with the December bank statement indicates the bank collected directly an interest amounting $4,540 in cash on a long-term note and
credited in its account. Gulf Company had not recorded this transaction in the cash book before receiving the statement.
v. A debit memorandum for $1,200 lists a NSF (Not Sufficient Fund) check. The check had been received from a customer, Saeed. Gulf Company has not yet recorded this
check as NSF.
vi. Enclosed with the December statement is a $60 debit memorandum for bank services charges. It has not yet been recorded in cash book because no previous notification
had been received.
Required:
Prepare a bank reconciliation statement showing an adjusted balance in the cash book.
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