EBK AUDITING & ASSURANCE SERVICES: A SY
11th Edition
ISBN: 9781260687668
Author: Jr
Publisher: MCGRAW-HILL LEARNING SOLN.(CC)
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Chapter 16, Problem 16.13MCQ
To determine
Introduction:
Bank transfer is one were money is sent from one bank to another. Bank transfer schedule is prepared which is used by the auditor to check existence of kites by a client. It lists details of all transfers that is to and from client’s account.
Check Kiting is checking whether amount received is disbursed on the same date or not in books and how many bank reconciliations are outstanding and deposit in transit to be reconciled with bank balances.
To select: The correct option.
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Required:1. Prepare a bank reconciliation as of February 28.2. Prepare adjusting entries for Valentine based on the information developed in the bank reconciliation.3. What is the amount of cash that should be reported on the February 28 balance sheet?
Bank reconciliation
2 On Oct. 31, 20x1, Dark Co.'s cash balance per recards is P7,540,
while the balance per bank statement is P8,510. The following
information is determined:
a. The bank statement reflects a P780 deposit that is not yet
recorded in the books. The deposit pertains to a collection
of note receivable with a principal balance of P700; the
difference represents the interest on the note,
b. The bank statement also reflects a P25 withdrawal
representing service charges for the month.
c Dark Co. erroneously recorded a check drawn for P140 as
P410. The check, which is payment for an account payable,
cleared the bank at the correct amount.
d. Dark Co. erroneously recorded a P910 collection of an
account receivable as Pl90. The bank statement reflects the
correct amount of deposit.
A PL,900 check deposit on Oct. 31 is not yet reflected in the
bank statement.
E The following checks drawn by Dark Co. are not yet
presented to the bank for payment: Check 075 for P325,
Check 080 for…
Accompanying the bank statement was a credit memorandum for a short-term note collected by the bank for the depositor. This item would be included on the bank reconciliation as a(n) ____.
a.addition to the cash balance per bank
b.deduction from the cash balance per books
c.deduction from the cash balance per bank
d.addition to the cash balance per books
Chapter 16 Solutions
EBK AUDITING & ASSURANCE SERVICES: A SY
Ch. 16 - Prob. 16.1RQCh. 16 - Prob. 16.2RQCh. 16 - Prob. 16.3RQCh. 16 - Prob. 16.4RQCh. 16 - Prob. 16.5RQCh. 16 - Prob. 16.6RQCh. 16 - Prob. 16.7RQCh. 16 - Prob. 16.8RQCh. 16 - Prob. 16.9RQCh. 16 - Prob. 16.10RQ
Ch. 16 - Prob. 16.11RQCh. 16 - Prob. 16.12MCQCh. 16 - Prob. 16.13MCQCh. 16 - Prob. 16.14MCQCh. 16 - Prob. 16.15MCQCh. 16 - Prob. 16.16MCQCh. 16 - Prob. 16.17MCQCh. 16 - Prob. 16.18MCQCh. 16 - Prob. 16.19MCQCh. 16 - Prob. 16.20MCQCh. 16 - Prob. 16.21MCQCh. 16 - Prob. 16.22MCQCh. 16 - Prob. 16.23MCQCh. 16 - Prob. 16.24PCh. 16 - Prob. 16.25PCh. 16 - Prob. 16.26PCh. 16 - Prob. 16.27PCh. 16 - Prob. 16.28PCh. 16 - Prob. 16.29PCh. 16 - Prob. 16.30P
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- Which of the following items are found on a book side of the bank reconciliation? A. beginning bank balance B. outstanding checks C. interest income D. error made by bankarrow_forwardThe bank reconciliation revealed that one deposit had cleared the bank two weeks after the date of the deposit. Should this be of concern? Why, or why not?arrow_forwardComplete parts d,e, and farrow_forward
- Reconciliation Items per Bank - Deposits in Transit Question; What does it mean when it says to compare individual deposits on the bank statement with: 1) the deposits in transit from the preceding bank reconciliation. AND 2) the current month's deposits recorded in the company's books. Please explain e.g's would be helpful as well.arrow_forwardFollowing is the general format of a four-column bank reconciliation with the various categories and presentation numbered (1) through (8): November Receipts Balance November Balance 10/31 Disbursements 11/30 Per Bank Statement Items to be added Items to be deducted: Per Books $XXXXX SXXXXX 3 $XXXXX $XXXXX 7 1 2 SXXXXX 6. SXXXXX SXXXXX 8 SXXXXX Indicate the proper location for the following reconciling items. A customer check received by the company in October was erroneously recorded twice by the books. The books were corrected in November by recording a negative receipt. This item will appear as: Select one: O a. 2 and 3 O b.3 and 7 O c.4 and 8 O d. 1 and 4 O e. 1 and 7arrow_forwardFollowing is the general format of a four-column bank reconciliation with the various categories and presentation numbered (1) through (8): Balance 10/31 November November Receipts Disbursements Balance 11/30 SXXXXX 3 Per Bank Statement Items to be added. Items to be deducted: Per Books SXXXXX 1. $XXXXX SXXXXX 7. SXXXXX SXXXXX SXXXXX SXXXXX Indicate the proper location for the following reconciling items. Assume the books record NSF checks as disbursements. A 10/31 NSF check will appear as: Select one: O a.1 and 5 O b.2 and 5 O cl and 4 O d. 2 and 3 O e. 2 and 6arrow_forward
- Prepare the bank reconciliation for april and the journal entries that should be made as a result of the bank reconciliation. What should the cash account be after recording the journal entries?arrow_forwardFor each of the items in the following list, identify where it is included on a bank reconciliation: 1. EFT payment made by a customer. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Bank debit memorandum for service charges. Outstanding cheques from the current month. Bank error in recording a $1,779 deposit as $1,977. Outstanding cheques from the previous month that are still outstanding. Outstanding cheques from the previous month that are no longer outstanding. Bank error in recording a company cheque made out for $160 as $610. Bank credit memorandum for interest revenue. Company error in recording a deposit of $160 as $1,600. Bank debit memorandum for a customer's NSF cheque. Deposit in transit from the current month. Company error in recording a cheque made out for $630 as $360.arrow_forward6, 7, A bank reconciliation for October 31 follows. Bank statement balance Add: Deposit in transit Deduct: Outstanding checks Adjusted bank balance View transaction list < 1 2 Note: Enter debits before credits. Date October 31 Bank Reconciliation October 31 Journal entry worksheet Cash $ 6,482 3 291 6,773 79 $ 6,694 Prepare the necessary journal entries based on the bank reconciliation. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Book balance Add: 4 Collection of a note Interest earned Deduct: NSF check Bank service charges Adjusted book balance Record the $400 collection of a note receivable by the bank on our behalf. Saved General Journal $ 400 64 Debit 63 61 $ 6,354 Credit 464 6,818 124 $6,694arrow_forward
- Bank Reconciliation REQUIRED: A. Based on the application of the necessary procedures and appreciation of the above data, you are to provide the answers to the following: 1. How much is the unadjusted book receipts for August? 2. How much is the unadjusted book disbursements for August? 3. How much is the adjusted book receipts for August? 4. How much is the adjusted book disbursements for August? 5. How much is the adjusted cash balance as of August 31, 2022? B. Show the four column proof of cash as of August 31, 2022. C. Show the correct bank reconciliation, in good form, on August 31, 2022.arrow_forward64. Outstanding checks for current period shall: Group of answer choices Added to disbursements and deducted from ending cash balance – bank. Added to disbursements and added to ending cash balance – bank. Deducted from the previous month cash balance and deducted from disbursements – bank. Added to receipts and added to ending cash balance – book.arrow_forwardUse the following information for the next three questions: The following information were obtained from Freedom Corporation for the purpose of preparing the bank reconciliation for the month of June 2021: SUBSIDIARY LEDGER CASH IN BANK - BDO CURRENT ACCOUNT June 1-30, 2021 Description Jun 1 Bal. forwarded Jun 5 Cash Deposit - cash sales Jun 8 Check # 01001 Date Debit Credit Balance 1,500,000.00 120,000.00 1,620,000.00 22,500.00 1,597,500.00 Check deposit (BDO Check Jun 10 #01098)-Customer's check 81,200.00 1,678,700.00 Cash Deposit (per deposit slip Jun 12 dtd Jun 12 2021) 163,000.00 1,841,700.00 Check 01002 (payable to a Jun 15 supplier) 67,500.00 1,774,200.00 CM: Payment from XYZ Co. Jun 17 (customer) through BDO Adjustment: Jun 12 cash Jun 17 deposit erroneously recorded Jun 23 Check # 01003 (payable to a supplier) Check deposit (BPI CKWO1067)- 110,700.00 1,884,900.00 27,000.00 1,857,900.00 82,300.00 1,775,600.00 Jun 24 Customer's check 65,750.00 1,841,350.00 Cash deposit (per…arrow_forward
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