Rush Corporation borrowed $25,000 from the bank. Whichof the following accurately shows the effects of thetransaction?a. Increase cash by $25,000 and decrease notes payable by$25,000.b. Increase cash by $25,000 and increase notes payable by$25,000.c. Decrease cash by $25,000 and decrease notes payable by$25,000.d. Decrease cash by $25,000 and increase notes payable by$25,000.

The correct answer is:b. Increase cash by $25,000 and increase notes payable by $25,000.…

Answered: Rush Corporation borrowed $25,000 from…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter5: Internal Control And Cash

Section: Chapter Questions

Problem 2SEQ

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In a bank reconciliation, to adjust for the bank's deducting $980 for a company check that you wrote and booked for $890 requires A. increasing the book balance by $90 B. reducing the book balance by $90 C. increasing the bank balance by 590 D. reducing the bank balance by $90
The bank reconciliation for Widgets Inc. included the following items: $30 bank service charge; NSF check of $275; bank error of $30; EFT collection from a customer for $2,335. Based on the information, Widgets Inc. will adjust cash by what amount? O $1,480 O $2,030 O $2,000 O $2,060
Raven Corp has a checking account balance of $150,000, a bank overdraft of $40,000 on a different bank account at a different bank, petty cash of $1,000, post-dated checks received totaling $10,000, and a certificate of deposit (that matures in four months) for $200,000. How much should be reported as cash in the balance sheet? a. $111,000 b. $121,000 c. $151,000 d. $321,000
The bank statement for Tetra Company contained the following items: a bank service charge of $10; a credit memo for interest earned, $15; and a $50 NSF check from a customer. The company had outstanding checks of $100 and a deposit in transit of $300. Which of the following will be caused by recording the customer's NSF check? Multiple Choice Cash decreases. Stockholders' equity decreases. Accounts receivable increases and cash decreases. Accounts receivable increases.
. A company's bank statement shows a balance of $10,000, while its cash account in the company's records indicates a balance of $9,500. Upon further analysis, the following discrepancies are identified: Outstanding checks total $1,200. • The bank erroneously recorded a deposit of $500 as $50. • The company recorded a check for $800 as $80. • The bank charged a service fee of $25. Calculate the adjusted cash balance after reconciling these discrepancies. Remember to subtract any outstanding checks and bank errors, and add any unrecorded deposits or adjustments to the cash balance to arrive at the adjusted cash balance.
Horton Corporation is preparing a bank reconciliation and has identified the following potential reconciling items. For each item, indicate if it is (1) added to balance per bank statement, (2) deducted from balance per bank statement, (3) added to balance per books, or (4) deducted from balance per books. a.Deposit in transit $5,500. b.Bank service charges $25. c.Interest credited to Horton's account $31. d.Outstanding checks $7,422. e.NSF check returned $377 Use the information above for Horton Corporation. Prepare any entries necessary to make Horton's accounting records correct and complete.
If deposits per the cash ledger are $2,200, deposits per the bank ledger are $1,800, and the bank erroneously recorded a $400 deposit as $40, an adjustment of $360 for deposits in transit will be recorded on the bank reconciliation. O True O False
Upon review of the most recent bank statement, you discover that a check was made out to your supplier for $76 butwas recorded in your Cash and Accounts Payable accountsas $67. Which of the following describes the actions to betaken when preparing your bank reconciliation?Balance per Bank Balance per Booka. Decrease No changeb. Increase Decreasec. No change Decreased. Decrease Increase
The cash account in the ledger of Tristan company shows a balance of 1,652,000 at Sept. 30. The bank statement, however shows a balance of 2,090,000 at the same date. The only reconciling items consist of a bank service charge of 2,000, a large number of outstanding checks totaling 590,000 and a deposit in transit. What is the deposit in transit in the Sept. 30 bank reconciliation?
1. A company makes a sale to a customer on credit and borrows cash (70-90% of the amount of sales) from a bank using receivables as security. When the company receives the customer payment, it sends this money to the lender. This transaction is an example of what? Factoring with recourse Securitization Collateralized borrowing Nonrecourse factoring 2. Which of the following statements about the direct and indirect methods for presenting Cash Flow Statement is NOT true? According to the indirect method, cash flows begin with net income or loss and is followed by subsequent additions to or deductions from that amount for non-cash revenue and expense items, resulting in cash flow from operating activities. The direct method is based on use of actual cash inflows and outflows from a company’s operations. Using direct and indirect methods leads to different amounts shown as cash flow from operations, investing, and financing activities.…

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