Part II Problems (2 Problems, 32 points) 1. The following information is availab

Question

Part II Problems (2 Problems, 32 points) 1. The following information is available for the Supply Company for the month of June. (24 points) a. On June 30, after all transactions have been recorded, the balance in the company's Cash account has a balance of $17,202 b. The company's bank statement shows a balance on June 30 of S19,279 c. Outstanding checks at June 30 total $2,984 d. A credit memo included with the bank statement indicates that the bank collected $770 on a noninterest-bearing note receivable for Supply e. A debit memo included with the bank statement shows a $67 NSF check from a customer, Maroon f. A deposit placed in the bank's night depository on June 30 totaling $1,675 did not appear on the bank statement. g. Comparing the checks on the bank statement with the entries in the accounting records reveals that check #3445 for the payment of an account payable was correctly written for $2.450. but was recorded in the accounting records as $2,540. h. Included with the bank statement was a debit memorandum in the amount of $25 for bank service charges. It has not been recorded on the company's books. Required a. Prepare the June bank reconciliation for the Supply Company b. Prepare the general journal entries to bring the company's book balance of cash into conformity with the reconciled balance as of June 30 2. Kerley Company uses the allowance method to account for uncollectibles. On February 28 the firm had accounts receivable in the amount of $437000 and Allowance for Doubtful Accounts had a credit balance of S2,140 before adjustment. Net credit sales for February amounted to S3,000,000. The credit manager estimated that uncollectible accounts expense would amount to 1% of net credit sales made during February. On March 10, an accounts receivable from Kathy Black for S6,100 was determined to be uncollectible and written off. However, on March 31, Kerley Company received a payment of $3,000 from Kathy Black. This payment is on Kathy Black's account written off March 10th of this year. (8 points) Required Prepare the journal entries made by Kerley Company on the following dates: (a) February 28, (b) March 10, and (c) March 31

Explanation / Answer

1.a.

1.b.

2

Supply Company Bank Reconciliation June Balance as per bank 19279 Balance as per books 17202 Additions: Additions: NSF check 67 Outstanding checks 2984 Deposits in transit 1675 Note receivable collected by bank 770 Bank service charges 25 Wrong entry of check in cash book 90 1767 3844 Deductions: Deductions: Outstanding checks 2984 NSF check 67 Note receivable collected by bank 770 Deposits in transit 1675 Wrong entry of check in cash book 90 Bank service charges 25 3844 1767 Balance as per cash book 17202 Balance as per bank 19279

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