Selected transactions completed by Kornett Company during its first fiscal year
ID: 2499317 • Letter: S
Question
Selected transactions completed by Kornett Company during its first fiscal year ended December 31, 2016, were as follows:
Record the following on journal page 22.
Residual
Acquisition
Useful Life
Asset
Cost
Value
Date
in Years
Depreciation Method Used
Kornett Company
POST-CLOSING TRIAL BALANCE
December 31, 2016
1
Petty Cash
4,500.00
2
Cash
243,960.00
3
Notes Receivable
100,000.00
4
Accounts Receivable
470,000.00
5
Allowance for Doubtful Accounts
16,000.00
6
Merchandise Inventory
320,000.00
7
Interest Receivable
1,875.00
8
Prepaid Insurance
45,640.00
9
Office Supplies
13,400.00
10
Land
654,925.00
11
Buildings
900,000.00
12
Accumulated Depreciation-Buildings
36,000.00
13
Office Equipment
246,000.00
14
Accumulated Depreciation-Office Equipment
44,000.00
15
Store Equipment
112,000.00
16
Accumulated Depreciation-Store Equipment
5,000.00
17
Mineral Rights
546,000.00
18
Accumulated Depletion
30,000.00
19
Patents
42,000.00
20
Social Security Tax Payable
25,470.00
21
Medicare Tax Payable
4,710.00
22
Employees Federal Income Tax Payable
40,000.00
23
State Unemployment Tax Payable
270.00
24
Federal Unemployment Tax Payable
40.00
25
Salaries Payable
157,000.00
26
Accounts Payable
131,600.00
27
Interest Payable
28,000.00
28
Product Warranty Payable
76,000.00
29
Vacation Pay Payable
10,500.00
30
Unfunded Pension Liability
50,700.00
31
Notes Payable
700,000.00
32
J. Kornett, Capital
2,345,010.00
33
Totals
3,700,300.00
3,700,300.00
Question: what is the bank reconciliation for December 2016?
Jan. 3 Issued a check to establish a petty cash fund of $4,500. Feb. 26 Replenished the petty cash fund, based on the following summary of petty cash receipts: office supplies, $1,680; miscellaneous selling expense, $570; miscellaneous administrative expense, $880. Apr. 14 Purchased $31,300 of merchandise on account, terms 1/10, n/30. The perpetual inventory system is used to account for inventory. May 13 Paid the invoice of April 14 after the discount period had passed. 17 Received cash from daily cash sales for $21,200. The amount indicated by the cash register was $21,240. Jun. 2 Received a 60-day, 8% note for $180,000 on the Ryanair account. Aug. 1 Received amount owed on June 2 note, plus interest at the maturity date. Assume a 360-day year. 24 Received $7,600 on the Finley account and wrote off the remainder owed on a $9,000 accounts receivable balance. (The allowance method is used in accounting for uncollectible receivables.) Sep. 15 Reinstated the Finley account written off on August 24 and received $1,400 cash in full payment. (Record as two entries.)Explanation / Answer
Bank reconciliation for December 2016 Balance as per Bank Statement 283000 Adjustments Less: Cheques Outstanding -68540 Add: Deposit in transit 29500 -39040 Adjusted/Correct Balance as per Bank 243960 Balance as per Books 245410 Adjustments Less: Bank Debit Memo for service charges 750 Less: Rectification of Incorrect Check amount entry(12700-12000) 700 1450 Adjusted/Correct Balance as per Books 243960 Journal Entry Miscellaneous Administrative Expense account 750 Bank 750 (Accounting of Bank Debit Memo for service charges)
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