Question: Problem 2 Presented below are extracts from the general ledger of the account and the relevant statement of account. Prepare bank reconciliation and prepare the
Problem 2
Presented below are extracts from the general ledger of the account and the relevant statement of account. Prepare bank reconciliation and prepare the relevant adjusting entries for December 31, 2020. Use the adjusted balance method.
Cash-in-Bank
Debit
Credit
Beginning balance, 12/1/19
2,000,000
Bank Service Charges for November 2020
20,000
NSF Check for November 2020
100,000
Loan from Bank net of P100,000 origination fee (granted in November 2020)
900,000
Deposit, 12/5/20
500,000
Check 115
50,000
Check 116
120,000
Check 117
80,000
Check 118
75,000
Check 119
60,000
Check 120
140,000
Deposit, 12/16/20
120,000
Deposit, 12/20/20
400,000
Check 122
280,000
Check 123
100,000
Deposit, 12/25/20
200,000
Check 124
300,000
Deposit, 12/31/20
250,000
Xandra Company
Debit
Credit
Beginning balance, 12/1/20
1,500,000
Deposit, 11/31/20
1,000,000
Error made in November when the bank erroneously debited the account of Xandra Company for check issued by Sandra Company
1,000,000
Bank Service Charges for December 2020
18,000
NSF Check from customer in December 2020
32,000
First month loan payment
100,000
Check 110
80,000
Check 111
240,000
Check 112
130,000
Check 113
150,000
Deposit, 12/5/20
500,000
Deposit, 12/16/20
120,000
Deposit, 12/20/20
400,000
Check 121
100,000
Check 115
50,000
Check 116
120,000
Check 117
80,000
Check 118
75,000
Check 119
60,000
Check 124
300,000
Deposit, 12/25/20
200,000
Additional information:
1. Check 114 amounting to P120,000 issued on November 31, 2020 remains not cashed by December 31, 2020.
2. All checks issued and/or cashed were with proper authorization and all signatures were verified.
Problem 2. Prepare the bank reconciliation on December 31, 2020 (10 points). Prepare the adjusting entries (5 points). Email the photo/s to me. Then, answer the following:
7. How much is the net adjustment to cash in bank on December 31, 2020? State your answer by stating in this manner: DEBIT XXX or CREDIT XXX.*
8. How much is the deposit in transit?*
9. How much is the total outstanding checks?*
10. How much is the adjusted balance of cash in bank?*
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