ACC 291 Week 3 Apply: Connect Assignment

1

Royal Jewels, a retail business, started business on June 25, 2019. It keeps a $300 change fund in its cash register. The cash receipts for the period from June 25 to June 30, 2019 are below.

Required:

2. Record the cash receipts from June 25 to June 30, 2019, in a general journal.
3. Post the amounts for Cash Short or Over in the journal entries to the general ledger.

Analyze:

How will the balance in Cash Short or Over on June 30 be reported in the financial statements?

2

On August 31, 2019, the balance in the checkbook and the Cash account of the Dry Creek Bed and Breakfast was $12,199. The balance shown on the bank statement on the same date was $13,152.

Notes

1. The firm’s records indicate that a $1,360 deposit dated August 30 and a $692 deposit dated August 31 do not appear on the bank statement.
2. A service charge of $7 and a debit memorandum of $275 covering an NSF check have not yet been entered in the firm’s records. (The check was issued by Art Corts, a credit customer.)
3. The following checks were issued but have not yet been paid by the bank:

1. A credit memorandum shows that the bank collected a $2,039 note receivable and interest of $54 for the firm. These amounts have not yet been entered in the firm’s records.

Required:

1. Prepare a bank reconciliation statement for the firm as of August 31.
2. Record general journal entries for items on the bank reconciliation statement that must be journalized.

Analyze:

What effect did the journal entries recorded as a result of the bank reconciliation have on the fundamental accounting equation?

3

On August 1, 2019, the accountant for Western Imports downloaded the company’s July 31, 2019, bank statement from the bank’s Website. The balance shown on the bank statement was $28,770. The July 31, 2019, balance in the Cash account in the general ledger was $14,131.

Jenny Irvine, the accountant for Western Imports, noted the following differences between the bank’s records and the company’s Cashaccount in the general ledger:

31. An electronic funds transfer for $14,500 from Foncier Ricard, a customer located in France, was received by the bank on July 31.
32. Check 1422 was correctly written and recorded for $1,200. The bank mistakenly paid the check for $1,270.
33. The accounting records indicate that Check 1425 was issued for $66 to make a purchase of supplies. However, examination of the check online showed that the actual amount of the check was for $96.
34. A deposit of $890 made after banking hours on July 31 did not appear on the July 31 bank statement.
35. The following checks were outstanding: Check 1429 for $1,250, and Check 1430 for $142.
36. An automatic debit of $263 on July 31 from CentralComm for telephone service appeared on the bank statement but had not been recorded in the company’s accounting records.

Required:

1. Prepare a bank reconciliation for the firm as of July 31.
2. Record general journal entries for the items on the bank reconiliation that must be journalized.

Analyze:

What effect on total expenses occurred as a result of the general journal entries recorded?