The cash account for Brentwood Bike Co. at May 1 indicated a balance of $32,788. During May, the total cash deposited was $139,699, and checks written totaled $138,679. The bank statement indicated a balance of $42,830 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items: a. Checks outstanding totaled $6,659. b. A deposit of $1,875 representing receipts of May 31 had been made too late to appear on the bank statement. c. The bank had collected for Brentwood Bike Co. $6,195 on a note left for collection. The face of the note was $5,900. d. A check for $170 returned with the statement had been incorrectly charged by the bank as $710. e. A check for $310 returned with the statement had been recorded by Brentwood Bike Co. as $130. The check was for the payment of an obligation to Adkins Co. on account. f. Bank service charges for May amounted to $24. g. A check for $1,213 from Jennings Co. was returned by the bank due to insufficient funds. CHART OF ACCOUNTSBrentwood Bike Co.General Ledger ASSETS 110 Cash 111 Petty Cash 112 Accounts Receivable-Jennings Co. 131 Notes Receivable 141 Merchandise Inventory 145 Office Supplies 146 Store Supplies 151 Prepaid Insurance 181 Land 191 Office Equipment 192 Accumulated Depreciation-Office Equipment 193 Store Equipment 194 Accumulated Depreciation-Store Equipment LIABILITIES 211 Accounts Payable-Adkins Co. 221 Notes Payable 222 Interest Payable 231 Salaries Payable 241 Sales Tax Payable EQUITY 310 Owner, Capital 311 Owner, Drawing 312 Income Summary REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Merchandise Sold 515 Credit Card Expense 516 Cash Short and Over 520 Salaries Expense 531 Advertising Expense 532 Delivery Expense 533 Insurance Expense 534 Office Supplies Expense 535 Rent Expense 536 Repairs Expense 537 Selling Expenses 538 Store Supplies Expense 561 Depreciation Expense-Office Equipment 562 Depreciation Expense-Store Equipment 590 Miscellaneous Expense 710 Interest Expense Labels For the Month Ended May 31 May 31 Amount Descriptions Bank error in charging check as $170 instead of $710 Bank error in charging check as $710 instead of $170 Bank service charges Check returned because of insufficient funds Company error in recording note collected by bank Deposit of May 31, not recorded by bank Error in recording check Outstanding checks Note and interest collected by bank 3. If a balance sheet is prepared for Brentwood Bike Co. on May 31, what amount should be reported as cash?

The cash account for Brentwood Bike Co. at May 1 indicated a balance of $32,788. During May, the total cash deposited was $139,699, and checks written totaled $138,679. The bank statement indicated a balance of $42,830 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items: a. Checks outstanding totaled $6,659. b. A deposit of $1,875 representing receipts of May 31 had been made too late to appear on the bank statement. c. The bank had collected for Brentwood Bike Co. $6,195 on a note left for collection. The face of the note was $5,900. d. A check for $170 returned with the statement had been incorrectly charged by the bank as $710. e. A check for $310 returned with the statement had been recorded by Brentwood Bike Co. as $130. The check was for the payment of an obligation to Adkins Co. on account. f. Bank service charges for May amounted to $24. g. A check for $1,213 from Jennings Co. was returned by the bank due to insufficient funds. CHART OF ACCOUNTSBrentwood Bike Co.General Ledger ASSETS 110 Cash 111 Petty Cash 112 Accounts Receivable-Jennings Co. 131 Notes Receivable 141 Merchandise Inventory 145 Office Supplies 146 Store Supplies 151 Prepaid Insurance 181 Land 191 Office Equipment 192 Accumulated Depreciation-Office Equipment 193 Store Equipment 194 Accumulated Depreciation-Store Equipment LIABILITIES 211 Accounts Payable-Adkins Co. 221 Notes Payable 222 Interest Payable 231 Salaries Payable 241 Sales Tax Payable EQUITY 310 Owner, Capital 311 Owner, Drawing 312 Income Summary REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Merchandise Sold 515 Credit Card Expense 516 Cash Short and Over 520 Salaries Expense 531 Advertising Expense 532 Delivery Expense 533 Insurance Expense 534 Office Supplies Expense 535 Rent Expense 536 Repairs Expense 537 Selling Expenses 538 Store Supplies Expense 561 Depreciation Expense-Office Equipment 562 Depreciation Expense-Store Equipment 590 Miscellaneous Expense 710 Interest Expense Labels For the Month Ended May 31 May 31 Amount Descriptions Bank error in charging check as $170 instead of $710 Bank error in charging check as $710 instead of $170 Bank service charges Check returned because of insufficient funds Company error in recording note collected by bank Deposit of May 31, not recorded by bank Error in recording check Outstanding checks Note and interest collected by bank 3. If a balance sheet is prepared for Brentwood Bike Co. on May 31, what amount should be reported as cash?

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 4E

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Hay number 3 is a final qustion but its not in the pics. thank you in advance

a.	Checks outstanding totaled $6,659.
b.	A deposit of $1,875 representing receipts of May 31 had been made too late to appear on the bank statement.
c.	The bank had collected for Brentwood Bike Co. $6,195 on a note left for collection. The face of the note was $5,900.
d.	A check for $170 returned with the statement had been incorrectly charged by the bank as $710.
e.	A check for $310 returned with the statement had been recorded by Brentwood Bike Co. as $130. The check was for the payment of an obligation to Adkins Co. on account.
f.	Bank service charges for May amounted to $24.
g.	A check for $1,213 from Jennings Co. was returned by the bank due to insufficient funds.

CHART OF ACCOUNTSBrentwood Bike Co.General Ledger

	ASSETS
110	Cash
111	Petty Cash
112	Accounts Receivable-Jennings Co.
131	Notes Receivable
141	Merchandise Inventory
145	Office Supplies
146	Store Supplies
151	Prepaid Insurance
181	Land
191	Office Equipment
192	Accumulated Depreciation-Office Equipment
193	Store Equipment
194	Accumulated Depreciation-Store Equipment

	LIABILITIES
211	Accounts Payable-Adkins Co.
221	Notes Payable
222	Interest Payable
231	Salaries Payable
241	Sales Tax Payable

	EQUITY
310	Owner, Capital
311	Owner, Drawing
312	Income Summary

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Merchandise Sold
515	Credit Card Expense
516	Cash Short and Over
520	Salaries Expense
531	Advertising Expense
532	Delivery Expense
533	Insurance Expense
534	Office Supplies Expense
535	Rent Expense
536	Repairs Expense
537	Selling Expenses
538	Store Supplies Expense
561	Depreciation Expense-Office Equipment
562	Depreciation Expense-Store Equipment
590	Miscellaneous Expense
710	Interest Expense

Labels
For the Month Ended May 31
May 31
Amount Descriptions
Bank error in charging check as $170 instead of $710
Bank error in charging check as $710 instead of $170
Bank service charges
Check returned because of insufficient funds
Company error in recording note collected by bank
Deposit of May 31, not recorded by bank
Error in recording check
Outstanding checks
Note and interest collected by bank

3. If a balance sheet is prepared for Brentwood Bike Co. on May 31, what amount should be reported as cash?

2. Journalize the necessary entries. The accounts have not been closed. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries.
CNOW journals will automatically indent a credit entry when a credit amount is entered.
PAGE 1
JOURNAL
ACCOUNTING EQUATION
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
ASSETS
LIABILITIES
EQUITY
1
2
3
5

1. Prepare a bank reconciliation as of May 31. Be sure to complete the statement heading. Refer to the Labels and Amount Descriptions for the exact wording of text entries. "Deduct:" or"Add:" will automatically appear if it is required. Whenever there is more than one
adjusting item in the bank portion of the reconciliation or the general ledger portion of the bank reconciliation, enter in the order presented in the instructions. Enter all amounts as positive numbers.
BRENTWOOD BIKE CO.
Bank Reconciliation
(Label)
1 Cash balance according to bank statement
2
3
5 Adjusted balance
7 Cash balance according to company's records
10
11
12 Adjusted balance

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