Oscar\'s Red Carpet Store maintains a checking account with Academy Bank. Oscar\

Question

Oscar's Red Carpet Store maintains a checking account with Academy Bank. Oscar's sells carpet each day but makes bank deposits only once per week. The following provides information from the company's cash ledger for the month ending February 28, 2018. No.22 321 218 322 323 324 Date 2/4 Amount Date Amount $ 2,150 Checks: $ 4,150 550 1,950 1650 350 Deposits: 2/18 2/25 1750 2,650 3,550 212 219 2/27 2/28 2/28 2/26- 2/28 325 326 327 Cash receipts: 1,050 850 11,150 1,350 Balance on February 1 Receipts Disbursements $6,250 11,150 10,850) $10,850 Balance on February 28 $ 6,550 Information from February's bank statement and company records reveals the following additional information: a. The ending cash balance recorded in the bank statement is $10,075. b. Cash receipts of $1,050 from 2/26-2/28 are outstanding. c. Checks 325 and 327 are outstanding. d. The deposit on 2/11 includes a customer's check for $350 that did not clear the bank (NSF check). e. Check 323 was written for $2,500 for advertising in February. The bank properly recorded the check for this amount. f. An automatic withdrawal for Oscar's February rent was made on February 4 for $1,300 g. Oscar's checking account earns interest based on the average daily balance. The amount of interest earned for February is $145 h. In January, one of Oscars suppliers, Titanic Fabrics, borrowed $4,900 from Oscar. On February 24, Titanic paid $5,050 ($4,900 borrowed amount plus $150 interest) directly to Academy Bank in payment for January's borrowing. i. Academy Bank charged service fees of $120 to Oscar's for the month.

Explanation / Answer

Oscar’s Red Carpet Store Bank Reconciliation February 28, 2018 Bank’sCash Balance Company’sCash Balance Before reconciliation $10,075 Before reconciliation 6550 Deposits outstanding 1050 NSF check -350 Checks outstanding 350+1350 -1700 Company error -2500+1950 -550 EFT for rent -1300 Interest on account 145 Note collected 4900 Interest on note 150 Service fees -120 After reconciliation 9425 After reconciliation 9425 Debit Credit Cash 5195 Notes Receivables 4900 Interest Revenue 295 Reconcile Cash increase Accounts receivable 350 advertising expense 550 Rent Expense 1300 Service Fee Expense 120 Cash 2320 Reconcile Cash decrease

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.