Question 1

Part A (8 minutes, 5 marks)

1. If the month-end bank statement shows a balance of $24,500, outstanding cheques are $8,000, a deposit of $3,500 was in transit at month end, and a cheque for $400 was erroneously charged by the bank against the account, the correct balance in the bank account at month end is

a. $20,400.

b. $24,400.

c. $20,100.

d. $20,000.

2. At December 31, 2022, Terminal Enterprises owns the following assets:

Cash in bank savings account at BMO $7,400

Cash floats for cash registers $3,300

Cash refund due (overpayment of income taxes) $3,600

A cheque from Priority Inc for $2,000 that had been deposited on December 20, but was returned NSF on December 29. The cheque was to be re-deposited on January 3, 2023 The original deposit has been included in the December 28 deposit.

Chequing account balance at BMO in an overdraft of ($6,200)

A cheque for $2,500 from Alliance Ltd. received December 30, 2022, which was not deposited until January 2, 2023.

A $4,000 money-market mutual fund with chequing account privileges was shown as a short term investment on the balance sheet.

A post dated cheque in the amount of $2,500 dated January 5, 2023.

Cash in foreign bank (Canadian dollar equivalent) $21,000

Ten petty cash accounts with a balance of $300 each.

Required:

Calculate the amount that should be shown as cash and cash equivalents on the Balance Sheet under IFRS. Show your work.