Project #81209 - Bank Reconciliation and Journal Entries

P5-3 Preparing a Balance Sheet and Analyzing Some of Its Parts LO5-3              
                     
Exquisite Jewelers is developing its annual financial statements for 2015. The following amounts were correct at December 31, 2015:   
                     
cash, $58,000; accounts receivable, $71,000; merchandise inventory, $154,000; prepaid insurance, $1,500;         
investment in stock of Z corporation (long-term), $36,000; store equipment, $67,000; used store equipment held for disposal, $9,000;   
accumulated depreciation, store equipment, $19,000; accounts payable, $52,500; long-term note payable, $42,000; income taxes payable, $9,000;
retained earnings, $164,000; and common stock, 100,000 shares outstanding, par value $1.00 per share (originally sold and issued at $1.10 per share).
                     
Required:                  
1 Based on these data, prepare a December 31, 2015, balance sheet. (Amounts to be deducted should be indicated by a minus sign.)  
  Possible input areas are shaded.                  
                     
  EXQUISITE JEWELERS              
  Balance Sheet              
  December 31, 2015              
  Assets              
  Current assets:                  
                     
                     
                     
                     
                     
  Total current assets    $                    -                
  Long-term investments:                  
                     
                     
  Fixed assets:                  
                     
                     
                     
  Total fixed assets                          -                
  Other assets:                  
                     
                     
  Total assets    $        377,500              
  Liabilities              
  Current liabilities:                  
                     
                     
                     
  Total current liabilities    $                    -                
  Long-term liabilities:                  
                     
                     
  Total liabilities                          -                
  Stockholders' Equity              
  Contributed capital:                  
                     
                     
                     
  Total contributed capital                        -                  
                     
                     
  Total stockholders' equity                          -                
  Total liabilities and stockholders' equity    $                    -                
                     
Required:                  
2 What is the net book value of the store equipment?                
                     
 

Net book value

 

 

P6-6 Preparing a Bank Reconciliation and Related Journal Entries LO6-5        
                 
The bookkeeper at Jefferson Company has not reconciled the bank statement with the Cash account, saying, “I don’t have time.”   
You have been asked to prepare a reconciliation and review the procedures with the bookkeeper.        
                 
     The April 30, 2014, bank statement and the April ledger accounts for cash showed the following (summarized):      
                 
    BANK STATEMENT        
    Checks Deposits Balance        
  Balance, April 1, 2014      $                                         31,000        
  Deposits during April    $          37,100 68,100        
  Interest collected   1,180 69,280        
  Checks cleared during April  $          43,000   26,280        
  NSF check—A. B. Wright 160   26,120        
  Bank service charges 50   26,070        
  Balance, April 30, 2014     26,070        
                 
    Cash           
    Apr. 1   Balance 23,500     41,100     Apr.    Checks written        
    Apr.      Deposits 41,500                
                 
A comparison of checks written before and during April with the checks cleared through the bank showed outstanding checks at the end   
of April of $5,600. No deposits in transit were carried over from March, but a deposit was in transit at the end of April.    
                 
Required:                
1 Prepare a detailed bank reconciliation for April.          
  Possible input areas are shaded.              
                 
  JEFFERSON COMPANY    
  Bank Reconciliation    
   April 30, 2014    
  Company's Books Bank Statement    
  Ending balance per cash account     Ending balance per bank statement        
  Additions:     Additions:        
                 
                 
                             -                              -      
                             -                              -      
  Deductions:     Deductions:        
                 
                 
                             -                              -      
  Correct cash balance     Correct cash balance   $24,870    
                 
Required:                
2 Prepare the journal entries that the company should make as a result of the bank reconciliation.      
   (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)    
                 
Transaction General Journal Debit Credit          
1                
                 
                 
                 
                 
2                
                 
                 
                 
                 
3                
                 
                 
                 
                 
                 
Required:                
3 What was the balance in the cash account in the ledger on May 1, 2014?        
                 
  Cash balance              
                 
4 What total amount of cash should be reported on the balance sheet at the end of April?      
                 
 

Activity Instructions

There is an ongoing debate about the cost-benefit relationship of internal controls and their ethical implications. Find one recent news article (published within the past three years) relating to internal controls over cash. Search Web sites like those of the New York Times and the Wall Street Journal. Then write a 1–2 page analysis of the particular situation, and discuss the ethical implications of the internal controls in that context. Apply what you know and have learned about the ethical standards of accounting practices to analyze the situation. Include a cover page and references in APA format.

Submission Requirements

  • Written communication: It should be free of errors that detract from the overall message.
  • APA formatting: Resources and citations are formatted according to APA (6th edition) style and formatting.
  • Length of paper: 1–2 pages, not including cover page and references.
  • Font and font size: Times New Roman, 12-point.
             
                 
                 
                 
                     
                     
                     
                     
                     
                     
                     

Subject Business
Due By (Pacific Time) 09/10/2015 12:00 pm
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