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  • Bank Statements Provide Information About All of The Following Except

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    The document provides multiple choice questions regarding cash account balances and reconciliations from balance sheets. It includes information about outstanding checks, deposits in transit, petty cash funds, and other cash account details. The correct cash balance or amount is provided as one of the multiple choice answers for each question.

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    Practice 3

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    The document provides multiple choice questions regarding cash account balances and reconciliations from balance sheets. It includes information about outstanding checks, deposits in transit, petty cash funds, and other cash account details. The correct cash balance or amount is provided as one of the multiple choice answers for each question.

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    © All Rights Reserved
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    28 views3 pages

    Bank Statements Provide Information About All of The Following Except

    Uploaded by

    yes yesno
    The document provides multiple choice questions regarding cash account balances and reconciliations from balance sheets. It includes information about outstanding checks, deposits in transit, petty cash funds, and other cash account details. The correct cash balance or amount is provided as one of the multiple choice answers for each question.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as docx, pdf, or txt
    of 3

    a. 273,500 b. 249,500 c. 261,500 d.

    264,500

    18.-19.(2 points) While checking the cash accounts of Denmark Company on December 31,2006, you find the following

    information:

    Balance per book 6,5000,000

    Balance in checking account(outstanding checks per

    Book of 1,660,000) 7,000,000

    Deposit in bank closed by BSP 1,500,000

    Deposit in transit 1,200,000

    Currency and coins on hand 400,000

    Petty cash fund(of which 10,000 is in form of paid vouchers) 50,000

    Bank charges not yet taken up in the book 10,000

    Bond sinking fund cash 1,000,000

    Receivables from employees 100,000

    Error in recording a check in the book. The correct

    Amount as paid by the bank is 100,000 instead of

    150,000 as recorded in the book, or a difference of 50,000

    The correct cash in bank balance for Denmark on December 31,2006 is a. 6,540,000

    d. 8040,000

    20. Bank statements provide information about all of the following except

    a. Checks cleared during the period

    b. NSF checks

    c. Bank charges for the period


    d. Errors made by the depositor

    21. The cash account in the current asset section of the balance sheet for Heater Company showed a balance of 555,000. It was found to

    include the following items:

    Petty cash fund(1,000 is in the form of paid vouchers) 5,000

    Checking account balance, per bank statement

    ( A 25,000 check is still outstanding) 255,000

    Undeposited receipts, including a post datedCheck for 5,000 120,000

    Currencies and coins awaiting deposit 55,000

    Bond sinking fund-cash 100,000

    Check drawn by manager, returned by bank marked NSF 20,000

    What is the correct cash balance for Heater Company’s balance sheet? a. 404,000

    22. The cash account in the current asset section of the December 31,2006 balance sheet of

    King Company consists of :

    Cash in banks 2,250,000

    Cash restricted for additions to plant(expected to be

    Disbursed in 2008) 3,000,000

    Petty cash funds(all funds were replenished on

    December 31,2006) 30,000

    Included in the cash in banks is a compensating balance of 750,000 against short term borrowing arrangements at December 31,2006.

    The compensating balance is not legally limited as to withdrawal by King Company.

    What is the correct cash balance of King Company at December 31,2006? a. 2,280,000
    23.Western Company reported a total cash and cash equivalent of 6,325,000 on December 31,2006, which includes the following

    information:

    a. two certificates of deposits, each totaling 500,000. These certificates of deposit have a maturity of 120

    days.

    b. A check that is dated January 12,2007 in the amount of 125,000.

    c. A commercial paper of 2,100,000 which is due in 120 days.

    d. Currency and coins on hand amounted to 7,700.

    Western Company has agreed to maintain a cash balance of 500,000 in one of its banks at all times to ensure future credit

    availability( this amount was included in the above balance)

    How much is the correct amount of cash and cash equivalents that Western Company should report in its December 31,2006 balance

    sheet?a. 2,600,000

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