Nicole s Getaway Spa NGS continues to grow and develop

Nicole #2707
Nicole’s Getaway Spa (NGS) continues to grow and develop. Nicole is now evaluating a
computerized accounting system and needs your help in understanding how source documents
inform accounting processes. She also needs some help reconciling NGS’s bank
account.Required:1. For each source document shown below, prepare the appropriate journal
entry or indicate that no journal entry is required. a. Purchase order dated October 13 for
massage chairs costing $ 765 and oil supplies costing $ 240.b. Remittance advice from
customer for $ 93, received October 17.c. Receiving report indicating October 22 receipt of
October 13 order. Also received supplier invoice totaling $ 1,005.d. NGS check for payment in
full of October 13 order.2. Nicole has asked you to prepare a bank reconciliation for NGS.
According to her records, NGS’s cash balance is $ 6,000 at December 31, but the bank reports
a balance of $ 5,500. a. The bank deducted $ 250 for an NSF check from a customer deposited
on December 22. b. NGS has written checks totaling $ 3,500 that have not yet cleared the bank.
c. The bank added $ 10 cash to the account for interest earned in December. d. NGS made a $
3,480 deposit on December 31, which will be recorded by the bank in January. e. The bank
deducted $ 10 for service charges. f. NGS wrote a check to a supplier on account for $ 300 but
mistakenly recorded it as $ 30.3. Prepare journal entries for items (a)–(f) from the bank
reconciliation, if applicable. If a journal entry is not Required. for one or more of the reconciling
items, indicate “no journal entry required.4. If NGS also has $ 120 of petty cash and $ 1,000
invested in government Treasury bills purchased in August, what is the amount of Cash and
Cash Equivalents on NGS’s December 31 balance sheet?View Solution:
Nicole s Getaway Spa NGS continues to grow and develop Nicole

ANSWER
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