Horngren's Financial & Managerial Accounting Plus MyLab Accounting with Pearson eText -- Access Card Package (6th Edition)
Horngren's Financial & Managerial Accounting Plus MyLab Accounting with Pearson eText -- Access Card Package (6th Edition)
6th Edition
ISBN: 9780134674568
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
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Chapter 7, Problem 7.10SE
To determine

Bank Reconciliation Statement: The Company maintains its own records from its perspective and they are different from bank perspective. This is why the cash balance per bank and cash balance per books seldom agree. Bank reconciliation is the statement prepared by company to remove the differences and disagreement between cash balance per bank and cash balance per books.

To journalize: Company’s transactions that arise from the bank reconciliation.

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Marilyn Terrill is the senior auditor for the audit of Uden Supply Company for the year ended December 31, 20X4. In planning the audit, Marilyn is attempting to develop expectations for planning analytical procedures based on the financial information for prior years and her knowledge of the business and the industry, including these: 1. Based on economic conditions, she believes that the increase in sales for the current year should approximate the historical trend in terms of actual dollar increases. 2. Based on her knowledge of industry trends, she believes that the gross profit percentage for 20X4 should be about 2 percent less than the percentage for 20X3. 3. Based on her knowledge of regulations, she is aware that the effective tax rate for the company for 20X4 has been reduced by 5 percent from that in 20X3. 4. Based on her knowledge of economic conditions, she is aware that the effective interest rate on the company's line of credit for 20X4 was approximately 12 percent. The…
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Horngren's Financial & Managerial Accounting Plus MyLab Accounting with Pearson eText -- Access Card Package (6th Edition)

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