BANK RECONCILIATION

Additional Problems

Try to solve these first on your own. Without further notice, I will post the final answers on or before February 28, 2023.

PROBLEM 1
The bank statement for the checking account of Cisco Systems, Inc. (CSI) showed a December 31, 2023 balance of P1,463,212.
Information that might be useful in preparing a bank reconciliation is as follows:

1) Outstanding checks were P140,000.

2) The December 31, 2023 cash receipts of P59,500 was deposited only on January 2, 2024.
3) One check written in payment of rent for P24,600 was recorded by the bank but was recorded by CSI as P26,400.
4) In accordance with prior authorization, the bank withdrew P45,000 directly from the checking account as payment on a mortgage
note payable. The interest portion of that payment was P5,000. CSI has made no entry to record the automatic payment.
5) Bank service charges of P1,400 was listed in the bank statement.
6) A deposit of P87,500 was recorded by the bank on December 13, but it did not belong to CSI. Further verification with the bank
indicates that the deposit should have been credited to the checking account of CIS, Inc.
7) The bank statement included a charge of P12,500 for a customer’s DAIF check. The check was returned with the bank statement
and the company will seek payment from the customer.

Required:
a. Prepare bank reconciliation.
b. Prepare adjusting entries.

PROBLEM 2
During your audit of Kim Possible Corporation, you established the following data concerning the cash position as of December 31, 2023:

1) Bank credit memo, P150,000

2) Bank debit memo, P4,500
3) Balance per bank statement, P850,000
4) Cash on hand and in bank, per books, P750,500
5) Outstanding checks, P120,400
6) Undeposited collections, P88,000
7) Check of Kin erroneously charged by the bank against Kim, P21,000
8) Check no. 4523 for P19,500 in payment to a supplier was erroneously recorded as P15,900

Required:
a. How much is the cash shortage/(overage)?
b. What is the adjusted cash balance?

PROBLEM 3
The following data pertaining to the cash transactions and bank account of Act, Count & See Company for the month of May are available
to you:

Cash balance per records, P17,194; Cash balance per bank statement, P31,948; Debit memo for the cost of printed checks
delivered by the bank, P125; Bank service charge, P109; Outstanding checks, P6,728; Deposit of May 30 not recorded by bank
until June 1, P4,880; Proceeds of a bank loan of May 30 (net of interest of P300), P5,700; Proceeds from a customer’s promissory
note (including interest of P100), P8,100; Check no. 2772 issued to a supplier entered in the accounting records at P2,100 but
deducted in the bank statement at an erroneous amount of P1,200; Stolen check lacking an authorized signature deducted from
Act, Count & See’s account by the bank in error, P800; Customer’s check returned by the bank marked NSF wherein no entry
has been made in the accounting records to record the returned check, P760

What is the correct cash balance at May 31?

a. P29,200 b. P30,000 c. P30,300 d. P30,900

PROBLEM 4
Shanghai Knights Company has prepared its bank reconciliation at March 31 taking the following information into account: Deposit in
transit, P1,500; Outstanding checks, P2,800; Bank charges shown in the bank statement but not recorded in the cash book, P125. The
adjusted cash book balance per bank reconciliation was a debit balance of P2,060. What was the balance as shown on the bank
statement at March 31?
a. P760 b. P885 c. P3,360 d. P3,485

PROBLEM 5
The August 31 bank statement of Winx Club Company showed a balance of P113,000. Deducted in arriving at this amount was a
customer’s NSF check for P2,400 that had been returned. Winx Club had received no prior notice concerning this check. In addition to
the bank statement, other records showed there were deposits in transit totaling P17,200 and that outstanding checks totaled P10,800.
What is the cash balance per books at August 31 prior to adjustments?
a. P115,400 b. P117,000 c. P119,400 d. P121,800