Exam 8: Banking Procedures and Control of Cash

Information on the Maritime Mining Company bank reconciliation included the following items: Bank service charges $ 20 Deposits in transit 700 Outstanding cheques 600 The journal entry to record the above items would include a

Explain why only the general ledger side of the bank reconciliation must be journalized.

Electronic funds transfers are a growing trend in Canada.

S.W.I.F.T. codes in modern banking make moving funds internationally a quick and accurate process.

If the ending balance in the Cash Short/Over account is a credit, it indicates that cash shortages have exceeded cash overages for the period.

One internal control safeguard is to assign all the duties of receiving, depositing, and recording cash to one employee.

Prepare journal entries for the following petty cash fund transactions: Aug. 1 Established a $50 petty cash fund. 31 Replenished the petty cash fund. Currency and coins remaining were $10. Approved paid vouchers were $6 donation expense, $9 postage expense, $12 office supplies expense, and $13 miscellaneous expense.

Red's Rentals entry to establish a $50 petty cash fund for the office would include a

When the bank pays a cheque written by the company, it would

What would a company gain by using a petty cash fund?

If the petty cash fund is too large, the Petty Cash Fund account should be increased.

The June bank statement for Paul's Plumbing shows a balance of $3,150, but the balance per books shows a cash balance of $3,990. Other information includes 1. Cheques outstanding totaled $970. 2) Bank service charges were $25. 3) A cheque for $100 to pay the telephone bill was recorded on the books as $10. 4) Included on the bank statement was an NSF cheque for $150 plus an NSF fee of $15. 5) Deposits in transit were $1,115. The adjusted cash balance at the end of June should be

The credit recorded in the journal entry to establish the petty cash fund is to

The bank added another company's deposit to our account. This would be included on the bank reconciliation as a(n)

If the owner of Kelly Legal Services forgot to deduct a withdrawal from the balance per books, what entry would be necessary?

Banks routinely return cancelled cheques with bank statements.

An employee assigned the responsibility for overseeing the petty cash fund is called the custodian.

The bank charged another company's cheque against our account, this would be included on the bank reconciliation as a(n)

Determine the unadjusted balance per bank statement given the following: The balance per general ledger is $200 There is a credit memo for a note collected, $450 There is a debit memo for interest expense, $100 There is a debit memo for a customer's NSF cheque $375 Outstanding cheques amount to $2,000 This month's service charge amounts to $50 Deposits in transit amount to $1,500

A deposit received by the bank will include