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Civil Engineering (BSCE 01)
Ateneo de Davao University
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COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
PROBLEM 1 In connection with your audit of the financial statements of Onor Company for the year ended Dec. 31, 2012, you gathered the following information. 1. The company maintains its current account with Tsunami Bank. The bank Statement on Dec. 31, 2012 showed a balance of P6380,340.
Your audit of the company’s account with Tsunami Bank disclosed the following: A check for P22,500 received from a customer whose account is current had been deposited and then returned by the bank on Dec. 28, 2012. No entry was made for the return of this check. The customer replaced the check on Jan 15, 2013. A check for P5,720 was cleared by the bank as P7,520. The bank made the correction on Jan. 2, 2013. A check for P3,500 representing payment of an employee advance was received and deposited on Dec. 27, 2012, but was not recorded until Jan. 3, 2013. Post dated check totaling P67,300 were included in the deposits in transit. These represent collections of current accounts receivable from customers. The checks were actually deposited on Jan. 5, 2013. Various debit memos for drafts purchased for payment of importation of equipment totaling P230,000 were not yet recorded. These purchases were previously set up as accounts payable. Said equipment arrived in Dec. 2012. Interest earned on the bank balance for the 4th quarter of 2012, amounting P1,950 was not recorded. Bank service charges totaling P1,260 were not recorded. Deposit in transit and outstanding checks at Dec. 31, 2012 totaled P136,250 and P276,380, respectively.
- Various expenses from the company’s imprest petty cash fund dated December 2012
totaled P16,250, while those dated January 2013 amounted P5,903. Another
disbursement from the fund dated December 2012 was a cash advance to an employee
amounting to P3,500. A replenishment of the petty cash fun was made on January 8,
- The company’s trial balance on December 31, 2012 includes the following accounts: Cash in bank – Tsunami Bank P784,320` Cash in bank – Earthquake Bank (restricted account for plant expansion, expected to be disbursed in 2013) 700, Petty cash fund 30, Time deposit, placed December 20, 2012 and due March 20, 2013 1,000, Money market placement – Prudential Bank 4,000,
- What is the adjusted petty cash fund balance on Dec. 31, 2012? A. P4,347 C. P30, B. P10,250 D. P24,
- The petty cash shortage on December 31, 2012 is? A. P0 C. P3, B. P5,903 D. P4,
- What is the adjusted Cash in bank – Tsunami Bank balance on December 31, 2012? A. P500,000 C. P432, B,320 D. P429,
- The entry to adjust the Cash in Bank – Tsunami Bank account should include a Debit to A. Account receivable for P89,800 C. Account receivable for P228, B. Accounts Receivable for P86,300 D. Account receivable for P1,
Problem 2: The accountant of SANTIAGO Company is in the process of preparing the company’s financial statements for the year ended December 31, 2012. He is trying to determine the correct balance of cash and cash equivalents to be reported as a current asset on the statement of financial position. The following items are being considered: Balances in the company’s accounts at the Metropolitan Bank: Current account P81, Savings account P132,
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
Undeposited customer checks of P22,200 (including a customer check dated January 2, 2013 for ₱3,000) Currency and coins on hand P3, Savings account at the Northern Philippines Bank with a balance of P2,400,000. This account is being used to accumulate cash for future plant expansion (in 2013) Petty cash of P4,000 (currency of P1,200 and unreplenished vouchers P2,800) P120,000 in a current account at the Northern Philippines Bank. This represents a 20% compensating balance for P600,000 loan with the bank. SANTIAGO Company is legally restricted to withdraw the funds until the loan is due in 2015. Treasury bills: Two−month maturity bills P90, Seven−month bills 120, Time deposit P100,
What is the correct balance of cash and cash equivalents to be reported in the current assets section of the statement of financial position? A) P547,480 C)P430, B) P427,480 D) P327,
PROBLEM 3: Your audit of the December 31, 2012 financial statements of NAGADU CORP. reveals the following: Current account at Prime Bank P(30,000) Current account at Prudent Bank 135, Treasury Bills (acquired 3 months before maturity) 300, Treasury Bills (maturing date is Dec, 2013) 1,500, Payroll account 390, Foreign bank account – restricted (translated using the Dec. 31, 2012 exchange rate) 2,000, Postage stamps 1, Employee’s postdated check 4, IOU from the vice-president 8, Credit memos from a supplier for a purchase return 8, 100 Travelers check 21, Money order 12, Petty cash fund (P3,000 in currency and expense Receipts for P12,000) 15, What amount would be reported as “cash and cash equivalents” in the statement of financial position on Dec. 31, 2012? A. P840,050 C. P849, B. P873,900 D. P861,
PROBLEM 4: The cash account of the HANNAH CORPORATION as of December 31, 2012 was composed of the following: On deposit in current account with the Bank of PI P900, 000 Cash collection not yet deposited in the bank 350, A customer’s check returned by the bank for insufficient fund 150, A check drawn by the Vice-President of the company dated January 15, 2013 70, A check drawn by a supplier dated December 28, 2012 for Goods returned by the company 60, A check dated May 31, 2012 drawn by the company against the Bank of Manila in payment of customs duties. since the importation did not materialize, the check was returned by the custom broker. This check an outstanding check in the reconciliation of the Bank of Manila 410, 000 Petty cash fund of which P10,000 is in currency, P7,200 in form of employee’s IOU’s; and P2,800 is supported by approved petty cash vouchers for expenses all dated prior to closing of the books on December 31, 2012 20, TOTAL P1,960,
Bank overdraft
12,
*unreplenished
vouchers is not
consider as part of
cash
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
B. Office supplies expense 3, Postage expense 2, Entertainment expense 840 Cash over and short 260 Petty Cash 6, C. Office supplies expense 3, Postage expense 2, Entertainment expense 840 Cash over and short 260 Cash 6, D. Office supplies expense 3, Postage expense 2, Entertainment expense 840 Petty Cash 6, 4. The objective of establishing a petty cash fund is to A. Cash checks for employees B. Account for all cash receipts and disbursements C. Account for cash sales D. Facilitate payment of small, miscellaneous items 5. What is the efect of not replenishing the petty cash at year-end and not making the appropriate adjusting entry? A. A detailed audit is essential B. The petty cash custodian should turn over the petty cash to the general cashier C. Cash will be overstated and expenses understated D. Expenses will be overstated and cash will be understated
PROBLEM 7: In connection with your audit of the financial statements of JEFF CORP. for the year ended December 31, 2012, you conducted a surprise count of the company’s petty cash fund and undeposited collection at 8:20 a. on January 3, 2013. Your count disclosed the following:
Bills and Coins: Bill Coins: P100 5 pieces 5 18 pieces 50 40 pieces 1 206 pieces 20 48 pieces 0 32 pieces
Postage Stamps (unused) - P
Checks Date payee Maker Amount Dec. 30 cash custodian P1, Dec Jef Corp. SLV, Inc. 14, Dec Jef Corp. Mario Lansang, sales manager
1,
Dec Jef Corp. MSU corp. 17, Dec. 31 Jef Corp. Ateneo Inc. 8, Dec. 31 Taiwan Corp. Jef Corp. 27,
Unreimbursed vouchers Date Payee Description Amou nt Dec. 23 Mario Lansang, sales manager
Advances for trip to Tagaytay City
P20,
0
28 Central Post Office Postage stamps 1, 29 messengers Transportation 150 29 Byte, Inc. Computer Repair 800
Other items found inside the cash box:
- Unclaimed pay envelope of Sinsinan MacDonut. Indicated on the pay slip is his salary of P7,500. Your inquiry revealed that Sinsinan’s salary is mingled with the petty cash fund.
- The sales manager’s liquidation report for his Tagaytay City trip.
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
Cash Advance received on Dec P20, Less: Hotel accommodation, meals, etc. P16, Bus fare for two 1, Cash given to Pablo, salesman 1,000 18, Balance P1,
Accounted for as follows: Cash returned by Pablo to the sales manager P Personal check of the sales manager 1, TOTAL 1,
Additional information: 1. The custodian is not authorized to cash checks. 2. The last official receipt included in the deposit on December 30 is No. 4351 and the last official receipt issued for the current year is No. 4355. The following official receipts are all dated December 31, 2012. OR # Amount Form of Payment 4352 P13,600 cash 4353 17,800 check 4354 3,600 cash 4355 8,300 check 3. The petty cash balance per ledger is P25,000. The last replenishment of the fund was made on December 22, 2012.
- What is the amount of shortage due from the sales manager? A. P240 C. P B. P1,800 D. P
- What is the amount of undeposited collections on Dec, 2012? A. P44,300 C. P57, B. 84,300 D. P41,
- The adjusting entries on December 31, 2012 should include a net debit to Travel expense of A. P17,320 C. P18, B. P18,320 D. P18,
- The cash count should include total checks of A. P69,980 C. P41, B. P42,980 D. P41,
- What is the total cash shortage? A. P22,166 C. P22, B. P8,166 D. P20,
PROBLEM 8: Tanya Velasco is reviewing the cash accounting for ABX, Inc. Tanya’s review will focus on the petty cash fund account and the bank reconciliation for the month ended may 31, 2012. She has collected the dfollowing information from ABX’s bookkeeper for this task.
Petty cash Fund 1. The petty cash fund was established on May 2, 2012, in the amount of P10,000. 2. Expenditures from the fund by the custodian as of May 31, 2012, were ecvidenced by approved petty cash vouchers for the following; Various office supplies P3, IOU from employees 1, Shipping charges 2, Miscellaneous expense 1, On May 31, 2012, the petty cash fund was replenished and increased to ₱12,000; currency and coin in the fund at the time totaled ₱756.
Bank Reconciliation Shore Bank Bank Statement
Disbursements Receipts Balance Balance, May 1, 2012 P350,
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
What is Emil Corporation correct cash balance at March 31?
- The following information pertains to a checking account of a company at June 30, 2012. Balance per bank statement P200, 000 Interest earned for the second quarter 500 Outstanding checks 15, 000 Customer’s checks returned for insufficient funds 5, 000 Deposit in transit 25, 000
What is the adjusted cash balance at June 30, 2012?
- A company is reconciling its bank statement with internal records. The cash balance per the company’s books is P45,000. There are P5, 000 of bank charges not yet recorded, P7,500 of outstanding checks, P12,500 of deposits in transit, and P 15,000 of bank credits and collections not yet taken up in the company’s books.
What is the cash balance per bank?
- A company shows a cash balance of P 175,000 on its bank statement dated June 30. As of June 30, there are P55, 000 of outstanding checks and P37,500 of deposits in transit.
What is the correct cash balance on the company nooks as of June 30?
- The cash account shows a balance of P225,000 before reconciliation. The bank statement does not include a deposit of P11, 500 made on the last day of the month. The bank statement shows a collection by bank of P4,700 and a customer’s check for P1,600 was returned because it was NSF. A customer’s check for P2,250 was recorded on the books as P2,700, and a check written for P395 was recorded as P485.
What should be the correct cash balance?
- On July 5, 2012, EMILIA CORP. received its bank statement for the month ending June 30.
The statement showed a P209,500 balance while cash account balance on June 30 was
P35,000. In reconciling the balances, the auditor discovered that:
- The June 30 collections of P176,000 were recorded on the books but were not deposited until July.
- The bank service charges for the month of June totaled P3,000.
- A paid check for P24,300 was entered incorrectly in the cash payments as P34,200.
What is the total outstanding check at June 31, 2012?
Answer the questions relating to each of the seven situations...
PROBLEM 10: The bank statement for the current account of IAN Co. showed a December 31, 2012, balance of P585,284. Information that might be useful in preparing bank reconciliation is as follows: a) Outstanding checks were P52, b) The December 31, 2012, cash receipts of P23,000 were not deposited in the bank until January 2, 2013. c) One check written in payment of rent P8,940 was correctly recorded by the bank but was recorded by IAN Co. as a P9,840 disbursement d) In a accordance with prior authorization, the bank withdrew P18,000 directly from the current account as payment on a mortgage not payable. The interest portion of that payment was P14,000. Ian Co. has made no entry to record the automatic payment. e) Bank service charges of P740 were listed on the bank statement f) A deposit of P35,000 was recorded by the bank on December 12, but it did not belong to Ian Co. g) The bank statement included a charge of P3,400 for a not-sufficient-fund check. The company will seek payment from the customer. h) Ian Co. maintains an P8,000 petty cash fund that was appropriately reimbursed at the end of December.
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
i) According to instructions from Ian Co. on December 31, the bank withdrew P40,000 from the account and purchased Treasury bills for Ian Co. the company recorded the transaction in its books on December 31 when it received notice from the bank. Half of the treasury bills mature in 3 months and the other half in 6 months.
- What is the cash bank balance per books on December 31, 2012? A. P549,714 C. P534, B. P543,514 D. P541,
- What is the adjusted cash in bank balance on December 31, 2012? A. P520,474 C. P518, B. P527,274 D. P520,
- What amount would Ian Co. report as cash and cash equivalents in the current asset section of the December 31, 2012, statement of financial position? A. P928,474 C. P720, B. P728,474 D. P735,
PROBLEM 11: The following data were taken from GARAY’s check register for the month of April. Garay’s bank reconciliation for March showed one outstanding check, check no. 178 for P2,150 (written on March 20), and one deposit for P4,350 (made on March 31).
2012, April Item checks deposits balanc e 1 Beginning Balance
6,
1 Deposit 26,167 32, 1 Check No. 179 250 32, 4 Check No. 180 10,673 21, 27 Deposit 11,774 33, 29 Check No. 181 13,217 20,
The following is from Garay’s Bank statement for April: Date Item Checks Deposi ts
Balance
2012, April 1
Beginning Balance 3,
3 Check No. 179 250 3, 3 Deposit 4,350 8, 5 Check no. 180 10,673 (2,623) 5 Automatic loan 8,150 5, 5 Deposit 26,417 31, 20 NSF check 1,000 30, 20 Service charge 600 30, 30 interest 82 30, Assume that any errors or discrepancies you find are Garay’s, not the bank’s.
What is the adjusted cash balance as of April 30? A. P26,833 C. P30, B. P26,838 D P26,
PROBLEM 12: The following information pertains to FLINT CORP:
Flint Corp BANK RECONCILIATION November 31, 2012
Balance per bank statement P435, Less: outstanding checks No. 4321 P6, 4329 15,
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
A. P446,375 C. P423, B. P417,825 D. P435, 5. What is the adjusted cas354h balance on December 31, 2012? A. P281,682 C. P226, B. P275,682 D. P274,
PROBLEM 13: EDGARDO CO. was organized on January 2, 2012. The following items are from the company’s trial balance on December 31, 2012. Ordinary share capital P1,500, Share premium 150, Merchandise inventory 69, Land 1,000, Building 1,400, Furniture and fixture 367, Accounts receivable 165, Accounts payable 389, Notes payable-bank 500, Sales 6,235, Operating expenses (including depreciation of P400,000) 1,005,
Additional information as follows: 1. Deposits in transit, December 31 P384, 2. Service charges for December 2, 3. Outstanding checks, December 31 475, 4. Bank balance, December 31 892, 5. Edgardo Co.’s mark up on sales is 30%
- What is the total collections from sales? A. P6,114,967 C. P6,235, B. P4,119,240 D. P6,069,
- What is the total payments for merchandise purchases? A. P3,905,990 C. P4,043, B. P4,649,140 D. P5,914,
- What is the total cash receipts per books? A. P7,819,800 C. P8,219, B. P,169,800 D. P8,069,
- What is the total cash disbursements per books? A. P7,816,140 C. P8,021, B. P7,416,140 D. P7,278,
- What is the cash balance per books on December 31? A. P653,660 C. P1,203, B. P803,660 D. P707,
- What is the adjusted cash balance on December 31? A. P801,660 C. P1,201, B. P651,660 D. P803,
PROBLEM 14: In connection with your audit of the cash account of ANNIE CROP., you gathered the following information. a. Balance per bank, December 1, 2012 P145, b. Total bank receipts (credits) in December 346, c. Balance per bank, December 31, 2012 114, d. Outstanding checks, Nov. 30, 2012 (including P12, paid by bank in December) 67, e. Outstanding checks, December 31,2012 (including checks issued in November) 94, f. Deposit in transit, November 30, 2012 39, g. A customer’s check received on December 4, 2012, was returned by bank on December 7 marked “NSF”. It was redeposited on December 8, 2012. The only entry made was to take up the collection
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
on December 4, 2012. 11,
- What is the total book receipt in December? A. P295,399 C. P334, B. P306,542 D. P346,
- What is the total bank disbursement in December? A. P315,500 C. P231, B. P376,500 D. P201,
- What is the total book disbursement in December? A. P447,519 C. P403, B. P331,519 D. P392,
PROBLEM 15: Your audit of the cash account of JUNIE CORP. disclosed the following information: 1. Cash in bank balance per books, Dec. 31, 2012 P35, 2. Bank statement balance, Dec. 31, 2012 60, 3. Note collected by bank in December (principal plus interest of P800, less collection fee of P200) 27, 4. Debit memo for a checkbook? 5. Deposit in transit, Dec. 31, 2012 15, 6. Transportation error made by bank in recording deposit of Dec. 28: Correct amount P45, Recorded as 54,000 9, 7. Erroneous bank debit 8. Included in the cash bank account is petty cash fund of P10,000. Your count on Dec. 31, 2012, revealed the following fund items: Currency and coins P3, Supplies 2, Transportation 100 IOUs 4,000 9, 9. Erroneous bank debit 11,
- What is the principal amount of the note collected by bank in December? A. P27,600 C. P28, B. P26,800 D. P27,
- What is the adjusted cash in bank balance at December 31, 2012? A. P52,500 C. P53, B. P52,700 D. P51,
- The cost of checkbook is A. P600 C. 0 B. P300 D. P
- What is the amount of petty cash shortage at December 31, 2012? A. P400 C. P B. P500 D. P
- What is the adjusted petty cash balance? A. P9,500 C. P3, B. P3,500 D. P10,
PROBLEM 16: The cash receipts and the cash payments of LIEZEL COMPANY for April 2012 follow: Cash receipts (cr) Cash payments (cp) Date Cash debit Check no. Cash credit April 2 P208,700 4113 P44, 8 20,350 4114 7, 10 27,950 4115 96, 16 109,350 4116 33, 22 92,700 4117 73, 29 53,000 4118 50, 30 16,850 4119 31, TOTAL 528,900 4120 83, 4121 5,
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
- What is the correct cash balance as of April 30? A. P132,850 C. P122, B. P87,700 D. P223,
PROBLEM 17: FERLYN COMPANY’s check register shows the following entries for the month of December: Date Checks Deposits Balance 2012, Dec 1
Beg. Balance P89,
5 Deposit P65,000 154, 7 Check no. 14344
P32,500 120,
11 Check no. 14345
14,000 106,
26 Deposit 49,000 155, 29 Check no. 14346
8,600 147,
Ferlyn’s bank reconciliation for November revealed one outstanding check (no. 14343) for P12,000 (written on November 28), and one deposit in transit for P5,550 (made on November 29).
The following is from Ferlyn’s bank statement for December 2012: Date checks Deposits Balance 2012, Dec. 1 Beg. Balance P95, 1 deposit P5,550 101, 4 Check no. 14344
P32,500 68,
5 Deposit 56,000 124, 14 Check no. 14345
14,000 110,
15 Loan proceeds
500,000 610,
20 NSF check 7,600 603, 29 Service charge
1,000 602,
31 Interest 3,600 605,
Assume that all errors were committed by Ferlyn Company, not the bank.
Based on the preceding information, determine the following: 1. Adjusted cash balance on November 30 a. P89,300 C. P102, b. P95,750 D. P101, 2. Outstanding checks on December 31 a. P46,500 C. P8, b. P45,500 D. P20, 3. Deposit in transit on December 31] a. P52,600 C. P5, b. P49,000 D. P43, 4. Total bank receipts in December a. P114,000 C. P565, b. P119,550 D. P61, 5. Adjusted cash balance on December 31 a. P663,800 C. P748, b. P634,200 D. P597,
PROBLEM 18: In connection with an audit, you are given the following bank reconciliation.
BANK RECONCILIATION
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
December 31, 2012
Balance per ledger, December 31, 2012 P34,
Add: Collections received on the last day of December And charged to “Cash in Bank” on books but Not deposited 5, Debit memo for customer’s check returned unpaid (Check is on hand but no entry has been made On the books) 4, Debit memo for bank service charge for December 1, P46,
Deduct: Outstanding checks (see detailed list below) P18, Credit memo for proceeds of a note receivable Which had been left at the bank for Collection but which has not been Recorded as collected 8, Check for an account payable entered on books a P12,625 but drawn and paid by bank as P16,225 3,600 32, Computed balance P14, Unlocated diference 36, Balance per bank (checked to confirmation) P51,
LIST OF OUTSTANDING CHECKS December 31, 2012 Check No. Amount 14344 P 5, 14358 1, 14367 3, 14399 2, 14401 4, 14407 5, P18,
What is the correct amount of outstanding checks on December 31? A. P18,625 C. P17, B. P22,625 D. P21,
The journal entry to correct the outstanding checks should include a A. Debit to Cash in bank of P4, B. Credit to Cash in bank of P4, C. Debit to accounts payable of P4, D. No journal entry is necessary
The correct amount of “unlocated diference” is A. P32,600 C. P36, B. P35,600 D. P
The Cash in bank to be shown on the company’s December 31, 2012 statement of financial position is A. P34,750 C. P33, B. P37,350 D. P37,
The journal entry to adjust the Cash in bank account of December 31 should be A. Debit Cash in bank of P8, B. Credit to Cash in bank of P8, C. Net credit to Cash in bank of P D. Net debit to Cash in bank of P
PROBLEM 20:
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
You are auditing general cash for DION COMPANY for the fiscal year ended July 31, 2012. The client has not prepared the July 31 bank reconciliation. After a brief discussion with the owner you agree to prepare the reconciliation, with assistance from one of Dion Company’s clerks. You obtain the following information:
General Ledger
Bank Statement Beginning balance P 46,110 P 57, Deposits 250, Cash receipts journal 254, Checks cleared (236,150) Cash disbursement journal
(218,110)
July bank service charge (870) Note paid directly (61,000) NSF check (3,110) Ending Balance P82,560 P 6,
Information in General Ledger and Bank Statement Balance per bank P57, Deposits in transit 6, Outstanding checks 17, Balance per books 46,
Additional information obtained is:
- Checks clearing that were outstanding on June 30 totaled P16,920.
- Checks clearing that were recorded in the July disbursements journal totaled P204,670.
- A check for P10,600 cleared the bank, but had not been recorded in the cash disbursements journal. It was for an acquisition of inventory. Dion uses the periodic inventory method.
- A check for P3,960 was charged to Dion Company but had been written on a diferent company’s bank account.
- Deposits included P6,000 from June and P244,560 for July.
- The bank charged Dion Company’s account for a not-sufficient-fund check totaling P3,110. The credit mnager concluded that the customer intentionally closed its account and the owner left the city. The check was turned over to a collection agency.
- A note for P58,000, plus interest, was paid directly to the bank under an agreement signed four months ago. The note payable was recorded at P58,00 on Dion Company’s book.
Based on facts given, answer the following:
- The checks outstanding on June 30 amount to a. P 9,980 c. P13, b. P10,830 d. P3,
- The deposits in transit on June 30 amount to a. P6,890 c. P6, b. P10,000 d. P9,
- The adjusted cash balance on July 31 is a. P6,980 c. P3, b. P10,940 d. P3,
- Which of the following audit procedures would be used to verify the payment of note in July? a. Check the arithmetical accuracy of the July 31 reconciliation. b. Check the absence of not on July 31 bank confirmation. c. Trace payment to duplicate deposit slip. d. Obtain cutof bank statement.
- The auditor would perform the following procedures to verify the unrecorded check of P10,600, except a. Obtain cutof bank statement b. Examine checks returned with July bank statement. c. Trace check number to absence in July cash disbursements journal and recording in August. d. Examine supporting documentation.
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
The cash account of VELASCO COMPANY shows the following activities:
CASH BOOKS
RECEIPTS PAYMENTS
- PROBLEM Buyagan, Poblacion, La Trinidad, Benguet
- Nov. 30 Balance P115, Date Debit Credit Balance
- Dec. 2 November bank charges P50 114, - notes receivable collected P10, 4 November bank credit for - 124,
- 15 NSF check 1,300 123,
- 20 Loan proceeds 48,500 172,
- 21 December bank charges 60 172,
- 31 Cash receipts book 707,300 879,
- 31 Cash disbursements book
- 08,
- 471,
- Dec. 1 110-120 P11, Date OR No. Amount Check No. Amount - - 801 P 2,
- 2 121-136 21,300 802 3,
- 3 137-150 20,000 803 1,
- 4 151-165 56,000 804 3,
- 5 166-190 39,000 805 12,
- 8 191-210 66,000 806 19,
- 9 211-232 88,000 807 26,
- 233-250 77,000 808 30,- 251-275 21,000 809 61,- 276-300 30,000 810 7,- 301-309 55,000 811 8,- 310-350 8,000 812 16,- 351-390 19,000 813 20,- 391-420 9,000 814 22,- 421-480 17,000 816 36,- 481-500 21,000 817 11,- 501-525 32,000 818 50,- - - 819 7,- - - 820 4,- 526-555 74,000 821 3,- 556-611 5,000 822 12,- - - 823 13,- 612-630 38,000 824 29,
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
- The adjusted bank receipts for the month of December should be a. P763,800 c. P765, b. P773,800 d. P767,
- The adjusted book disbursements for the month of December should be a. P403,480 c. P415, b. P415,540 d. P409,
- The adjusted bank balance at December 31 should be a. P592,270 c. P558, b. P477,270 d. P483,
PROBLEM 23
Shown below is the May 31, 2012, bank reconciliation prepared by your client’s staf. RECONCILIATION May 31, 2012 Bank Balance P652, Add: Deposit in transit 10, Total P662, Less: Outstanding checks No. 640 P10, 652 8, 653 2,
Book Balance P570, Add: Proceeds of note receivable Collected in May P70, Deposit on May 31 not Recorded on books until June 2,000 72, Total P642, Less: Bank service charge 800 Adjusted book balance P642,
The June 2012 bank statement is shown below: Pasig Bank Period Covered: May 31, 2012-June 30, Account No.: 0021261 Date Checks Deposits June 1 8,000 10, June 8 2, June 11 14,000 20, June 13 1,000 DM 1, June 16 4, June 21 12,000 56, June 27 18, June 29 1,000 EC 1,000 EC June 30 200 SV June 30 3,000 DM
SV- Service Charges DM-Debit Memo EC- Error Corrected CM- Credit Memo
The paid checks accompanying this bank statement (all clearing in June) are the following: No. 652 P8,000 No. 654 P14,000 No P12, No. 653 P2,000 No. 655 P4,000 No. 658 P18,
The check register reveals that the last check issued in June is No. 659 for P5,000 and that Check No. 656 is for P2,600.
Cash received for the period June 22 through June 30 of P70,000 was deposited in the bank on July 1.
COLLEGE OF BUSINESS EDUCATION AND ADMINISTRATION
Buyagan, Poblacion, La Trinidad, Benguet
The debit memos on June 13 and June 30 represent customer’s NSF checks returned by the bank. The June 13 NSF check was immediately redoposited without entry. The June 30 NSF was redoposited on July 1 without entry.
- What is the total bank receipts in June? a. P87,000 c. P77, b. P88,000 d. P78,
- What is the total bank disbursements in June? a. P59,200 c. P58, b. P58,000 d. P63,
- What is the balance per bank statement on June 30,2012? a. P676,800 c. P732, b. P627,200 d. P729,
- What is the total book receipts in June? a. P88,000 c. P146, b. P220,000 d. P218,
- What is the total book disbursements in June? a. P53,000 c. P56, b. P57,400 d. P63,
- What is the book balance on June 30, 2012? a. P732,200 c. P732, b. P729,200 d. P676,
PROBLEM 24
The following information was obtained in an audit of the cash account of CHELSEE COMPANY as of December 31, 2012. Assume that the CPA has satisfied himself as to the propriety of the cash book, the bank statement, and the returned checks, except as noted: 1. The bookkeeper’s bank reconciliation at November 30, 2012. Balance per bank statement P194, Add: Deposit in transit 11, Total P205, Less: Outstanding checks No. 1434 P1, No. 1562 7, No. 1571 5, No. 1584 8, No. 1591 300 23, Balance per books P182,
A summary of the bank statement for December 2012. Balance brought forward P194, Deposits 1,487, Total P1,681, Charges (1,325,000) Balance, December 31, 2012 P 356,
Included in cancelled checks returned with the December bank statement were the checks listed below.
The Chelsee Company discounted its own 60-day note for P90,000 with the bank on December 1, 2012. The discount rate was 6 percent. The accountant recorded the proceeds as a cash receipt at the face value of the note.
The accountant records customers’ dishonored checks as a reduction of cash receipts. When the dishonored checks are redeposited they are recorded as a regular cash receipt. Two NSF checks for P1,800 and P2,200 were returned by the bank during December. Both checks were redopsited and were recorded by the accountant.
Cancellations of Chelsee Company checks are recorded by a reduction of cash disbursements.
Audit of Cash - Im missing uuuu
Course: Civil Engineering (BSCE 01)
University: Ateneo de Davao University
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