Explain the statement, “Controls are only as good as the predetermined standard on which they are based.”

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Refer to the information given below: a. The June 30 cash balance in the general ledger is $1,940. b. The June 30 balance shown on the bank statement is $1,168. c. Checks issued but not returned with the bank statement were Number 712 for $33 and Number 723 for $160. d. A deposit made late on June 30 for $800 is included in the general ledger balance but not in the bank statement balance. e. Returned with the bank statement was a notice that a customer's check for $120 that was deposited on June 24 had been returned because the customer's account was overdrawn. f. During a review of the checks that were returned with the bank statement, it was noted that the amount of Check Number 728 was $72 but that in the company's records supporting the general ledger balance, the check had been erroneously recorded as a payment of an account payable in the amount of $27. Required: Prepare a bank reconciliation as of June 30 from the above information. Note: Total the entries of the same account…

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Chapter 8, Problem 6DQ

To determine

Explain the statement, “Controls are only as good as the predetermined standard on which they are based.”

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Refer to the information given below: a. The June 30 cash balance in the general ledger is $1,940. b. The June 30 balance shown on the bank statement is $1,168. c. Checks issued but not returned with the bank statement were Number 712 for $33 and Number 723 for $160. d. A deposit made late on June 30 for $800 is included in the general ledger balance but not in the bank statement balance. e. Returned with the bank statement was a notice that a customer's check for $120 that was deposited on June 24 had been returned because the customer's account was overdrawn. f. During a review of the checks that were returned with the bank statement, it was noted that the amount of Check Number 728 was $72 but that in the company's records supporting the general ledger balance, the check had been erroneously recorded as a payment of an account payable in the amount of $27. Required: Prepare a bank reconciliation as of June 30 from the above information. Note: Total the entries of the same account…

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