The Cash account of Alpha Corporation showed a balance of $65,332 on December 31. The bank statement as of that date showed a balance of $72,336. After comparing the bank statement with the company records, the following information was determined: 1. Deposits in transit as of December 31 amounted to $14,572. 2. Cheques issued in December but still outstanding at the end of the month amounted to $12,000. Cheques still outstanding from the month of November totaled $1,120. 3. The bank made a mistake in recording a payment received from a customer, overstating the funds deposited into the account by $112 4. Electronic receipts from customers in payment of their accounts totaled $9,398. These receipts have not yet been recorded by the company. 5. The company made an error in recording a customer's deposit in payment of its account. The company recorded the collection of the account as $418 when it should have been $580. The bank correctly recorded the deposit as $580. 6. The bank returned an NSF cheque in the amount of $956 deposited on December 20. The cheque was a payment on a customer's account. 7. The bank debited Alpha Corporation's account for service charges of $260. This included $90 for processing the NSF cheque (see item above), and $170 for bank service charges and debit and credit card fees. a.) Prepare a bank reconciliation for Alpha Corporation at December 31. b.) Prepare any journal entries necessary as a result of the bank reconciliation.
The Cash account of Alpha Corporation showed a balance of $65,332 on December 31. The bank statement as of that date showed a balance of $72,336. After comparing the bank statement with the company records, the following information was determined: 1. Deposits in transit as of December 31 amounted to $14,572. 2. Cheques issued in December but still outstanding at the end of the month amounted to $12,000. Cheques still outstanding from the month of November totaled $1,120. 3. The bank made a mistake in recording a payment received from a customer, overstating the funds deposited into the account by $112 4. Electronic receipts from customers in payment of their accounts totaled $9,398. These receipts have not yet been recorded by the company. 5. The company made an error in recording a customer's deposit in payment of its account. The company recorded the collection of the account as $418 when it should have been $580. The bank correctly recorded the deposit as $580. 6. The bank returned an NSF cheque in the amount of $956 deposited on December 20. The cheque was a payment on a customer's account. 7. The bank debited Alpha Corporation's account for service charges of $260. This included $90 for processing the NSF cheque (see item above), and $170 for bank service charges and debit and credit card fees. a.) Prepare a bank reconciliation for Alpha Corporation at December 31. b.) Prepare any journal entries necessary as a result of the bank reconciliation.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The Cash account of Alpha Corporation showed a balance of $65,332 on December 31. The bank statement as of that date showed a
balance of $72,336. After comparing the bank statement with the company records, the following information was determined:
1. Deposits in transit as of December 31 amounted to $14,572.
2. Cheques issued in December but still outstanding at the end of the month amounted to $12,000. Cheques still outstanding from the
month of November totaled $1,120.
3. The bank made a mistake in recording a payment received from a customer, overstating the funds deposited into the account by $112
4. Electronic receipts from customers in payment of their accounts totaled $9,398. These receipts have not yet been recorded by the
company.
5. The company made an error in recording a customer's deposit in payment of its account. The company recorded the collection of the
account as $418 when it should have been $580. The bank correctly recorded the deposit as $580.
6. The bank returned an NSF cheque in the amount of $956 deposited on December 20. The cheque was a payment on a customer's
account.
7. The bank debited Alpha Corporation's account for service charges of $260. This included $90 for processing the NSF cheque (see item
above), and $170 for bank service charges and debit and credit card fees.
a.) Prepare a bank reconciliation for Alpha Corporation at December 31.
b.) Prepare any journal entries necessary as a result of the bank reconciliation.
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