Intermediate Accounting I

Cash and cash equivalents

Problems:

1. Consider the following: Cash in Bank – checking account of P18,500, Cash on hand of P500, Post-dated
checks received totaling P3,500, and Certificates of deposit totaling P124,000. How much should be
reported as cash in the balance sheet?

2. Meliodas Company has cash in bank of P15,000, restricted cash in a separate account of P3,000, and a
bank overdraft in an account at another bank of P1,000. Meliodas should report cash of?

3. Casper Company has the following items at year-end:

Cash in bank P30,000
Petty cash 300
Short-term paper with maturity of 2 months 5,500
Postdated checks 1,400

Casper should report cash and cash equivalents of

4. Harlequin Company month-end bank statement shows a balance of P72,000, outstanding checks are
P24,000, a deposit of P8,000 was in transit at month end, and a check for P1,000 was erroneously
charged by the bank against the account, the correct balance in the bank account of Harlequin Company
at month end is?

5. Finley, Inc.’s checkbook balance on December 31, 2018 was P42,400. In addition, Finley held the
following items in its safe on December 31.
(1) A check for P900 from Peters, Inc. received December 30, 2018, which was not included in
the checkbook balance.
(2) An NSF check from Garner Company in the amount of P1,800 that had been deposited at the
bank, but was returned for lack of sufficient funds on December 29. The check was to be
redeposited on January 3, 2019. The original deposit has been included in the December 31
checkbook balance.
(3) Coin and currency on hand amounted to P2,900.

The proper amount to be reported on Finley's balance sheet for cash at December 31, 2018 is?

6. The cash account shows a balance of P90,000 before reconciliation. The bank statement does not
include a deposit of P4,600 made on the last day of the month. The bank statement shows a collection by
the bank of P1,880 and a customer's check for P640 was returned because it was NSF. A customer's
check for P900 was recorded on the books as P1,080, and a check written for P158 was recorded as
P94. The correct balance in the cash account was?

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 7. Escanor Plastics Company deposits all receipts and makes all payments by check. The following
information is available from the cash records:

MARCH 31, 2019 BANK RECONCILIATION

Balance per bank P26,746

Add: Deposits in transit 2,100
Deduct: Outstanding checks (3,800)
Balance per books P25,046

Month of April Results

Per Bank Per Books
Balance April 30, 2019 P27,995 P27,355
April deposits 11,784 13,889
April checks 11,100 10,080
April note collected (not included in April deposits) 3,000 -0-
April bank service charge 35 -0-
April NSF check of a customer returned by the bank
(recorded by bank as a charge) 900 -0-

Instructions
(a) Calculate the amount of the April 30, 2019:
1. Deposits in transit
2. Outstanding checks
(b) What is the April 30, 2019 adjusted cash balance?

8. Estarossa Corp.’s checkbook balance on December 31, year 2, was P5,000. In addition, Estarossa held
the following items in its safe on that date:

 P2,000 Check payable to Estarossa Corp., dated January 2, year 3, in payment of a sale made in
December year 2, not included in December 31 checkbook balance

 P500 Check payable to Estarossa Corp., deposited December 15 and included in December 31
checkbook balance, but re turned by bank on December 30 stamped “NSF.” The check was
redeposited on January 2, year 3, and cleared on January 9

 P300 Check drawn on Estarossa Corp.’s account, payable to a vendor, dated and recorded in
Ral’s books on December 31 but not mailed until January 10, year 3

The proper amount to be shown as Cash on Estarossa’s balance sheet at December 31, year 2, is_____.

9. Star Labs Company had the following account balances at December 31, year 2:
Cash in banks P2,250,000
Cash on hand 125,000
Cash legally restricted for additions to
plant (expected to be disbursed in year 3) 1,600,000

Cash in banks includes P600,000 of compensating balances against short-term borrowing arrangements.
The compensating balances are not legally restricted as to withdrawal by Burr. In the current assets
section of Burr’s December 31, year 2 balance sheet, total cash should be reported at
a. P1,775,000
b. P2,250,000
c. P2,375,000
d. P3,975,000

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 10. Stark Industries cash account as of December 31, 20x1:

Outstanding checks, 11/30/20x1 P 16,250

Outstanding checks, 12/31/20x1 12,500
Deposit in transit, 11/30/20x1 12,500
Cash balance per general ledger, 12/31/20x1 37,500
Actual company collections from its customers during
December 152,500
Company checks paid by bank in December 130,000
Bank service charges recorded on the company books
in December 2,500
Bank service charges per December bank statement 3,250
Deposits credited by bank during December 145,000
November bank service charges recorded on company
books in December 1,500

The cash receipts book of December is underfooted by P 2,500.

The bank erroneously charged the company's account for a P3,750 check of another depositor. This bank
error was corrected in January 20x2.

Questions:
a. How much is the deposit in transit on December 31, 20x1?
b. What is the total unrecorded bank service charges as of December 31, 20x1?
c. What is the total book receipts in December?
d. What is the total amount of company checks issued in December?
e. What is the total book disbursements in December?
f. What is the book balance on November 30, 20x1?
g. What is the bank balance on November 30, 20x1?
h. What is the total bank receipts in December?
i. What is the total bank disbursements in December?
j. What is the bank balance on December 31, 20x1?

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 11. S.H.I.E.L.D Company
General and Petty Cash Count

Bills and Coins

Denomination Pieces
P 500 218
100 454
50 610
20 1,008
10 20
5 608
1 1,040
0.25 4,032

Checks
Maker Payee Date Amount
Tissot - Customer Bonjour Company 12/30/20x1 P 23,840
Castro - Customer Bonjour Company 12/26/20x1 25,010
Allez - Customer Bonjour Company 1/2/20x2 11,414
Petra - Customer Bonjour Company 12/21/20x1 26,700
Bonjour Company Bonne Chance Corp. 12/27/20x1 29,000
Salut - Officer Bearer 1/5/20x2 620
Bueno* Cash 12/29/20x1 520
*Amount is for a return of travel advance made to the employee in an earlier period.

Vouchers and IOUS

Paid to Date Amount
BWD 1/2/20x2 P 70
BENECO 12/20/20x1 300
Eurotel - Christmas Party 12/23/20x1 12,580
Vina - IOU 12/27/20x1 600

Additional Notes:
1. Cash sales invoice (all currencies, No. 17903 to 18112), P 201,000.
2. Official Receipts
Number Amount Form of Collection
31250 P 1,120 Cash
31251 25,010 Check
31252 2,404 Cash
31253 23,840 Check
31254 26,700 Check
3. Stamps of various denomination amounted to P 160.
4. A notation on an envelope is "Proceeds from employee contribution for Christmas Party, P 19,000".
5. Petty cash per ledger, P 30,000.

Questions:
1. How much is the petty cash shortage as of January 5, 20x2?
2. What is the credit adjustment to correct the petty cash fund?
3. What is the adjusted petty cash fund as of December 31, 20x1?

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