Jessa B.

Cabael

BSA-2nd year.

Code/Schedule: C038 AE109/2:30-4:00

Activity Problem 3-6 (IAA). Proof of Cash.

*ADJUSTED METHOD

BIGOTRY COMPANY
PROOF OF CASH
For the Month of August

July 31 Cash Receipts Cash Disbursements August 31

Book Balance 1,200,000 4,400,000 3,600,000 2,000,000
Note Collected
July 200,000 (200,000)
August 300,000 300,000
NSF Check
July (100,000) (100,000)
August 50,000 (50,000)
Error: Deposit
Understatement
August 180,000 180,000
Error: Payable
Understatement
August 540,000 (540,000)
Adjusted balance 1,300,000 4,680,000 4,090,000 1,890,000

Bank Balance 800,000 5,000,000 3,940,000 1,860,000

Deposit in
Transit
July 600,000 (600,000)
August 480,000 480,000
Outstanding
Check
July (100,000) (100,000)
August 650,000 (650,000)
Error:
August (200,000) (200,000)
Error:
August (400,000) 400,000
Adjusted balance 1,300,000 4,680,000 4,090,000 1,890,000
*BOOK TO BANK METHOD

BIGOTRY COMPANY
PROOF OF CASH
For the Month of August

July 31 Cash Receipts Cash Disbursements August 31

Book Balance 1,200,000 4,400,000 3,600,000 2,000,000
Note Collected
July 200,000 (200,000)
August 300,000 300,000
NSF Check
July (100,000) (100,000)
August 50,000 (50,000)
Deposit in
Transit
July (600,000) 600,000
August (480,000) (480,000)
Outstanding
Check
July 100,000 100,000
August (650,000) 650,000
Error on collection:
August 180,000 180,000
Error on payment
August 540,000 (540,000)
Error on deposit:
August 200,000 200,000
Error on payment
August 400,000 (400,000)
Ending balance 800,000 5,000,000 3,940,000 1,860,000

Bank Balance 800,000 5,000,000 3,940,000 1,860,000

*BANK TO BOOK METHOD

BIGOTRY COMPANY
PROOF OF CASH
For the Month of August

July 31 Cash Receipts Cash Disbursements August 31

Bank Balance 800,000 5,000,000 3,940,000 1,860,000
Deposit in
Transit:
July 600,000 (600,000)
August 480,000 480,000
Outstanding
Check:
July (100,000) (100,000)
August 650,000 (650,000)
Note Collected:
July (200,000) 200,000
August (300,000) (300,000)
NSF Check
July 100,000 100,000
August (50,000) 50,000
Error on collection:
August (180,000) (180,000)
Error on payment
August (540,000) 540,000
Error on deposit:
August (200,000) (200,000)
Error on payment
August (400,000) 400,000

Ending balance 1,200,000 4,400,000 3,600,000 2,000,000

Book Balance 1,200,000 4,400,000 3,600,000 2,000,000

* ADJUSTING ENTRIES

August Cash 300,000

Notes Receivable 300,000

to record credit memo

Accounts Receivable 50,000

Cash 50,000

to record debit memo

Cash 180,000
Notes Receivable 180,000

to record understatement on collection

Accounts Payable 540,000

Cash 540,000

to record understatement of payable