ABM 6

Chapter 4 Examination March 21, 2022

1. The bank statement for Bandiola Co. indicates a balance of P7,735.00 on February 29, 2020.
After the journals for January had been posted, the cash account had a balance of P4,098.00.
Prepare a bank reconciliation on the basis of the following reconciling items and journalize
necessary entries:

a. Cash sales of P742 had been erroneously recorded in the cash receipts journal as P724.
b Deposits in transit not recorded by bank, P425.00.
c. Bank service charges, P35.00.
d Customer’s note collected by bank, P2,475 including P75 interest.
e NSF check from Janice Sinco, a customer P256.00.
f. Checks outstanding, P1,860.00.
3. Present entries to record the following transactions for Fortich Inc:
(a) Established a petty cash fund of P350.
(b) The petty cash fund now has a balance of P75.80. Replenished the fund, based on
the following disbursements as indicated by a summary of the petty cash receipts:
office supplies expense, P89.50; miscellaneous administrative expense, P108.75;
and miscellaneous selling expense, P65.60.
(c) Increased the petty cash fund to P400.
PROBLEM 1. Bandiola Co. 16 pts
Bank Reconciliation
February 29, 2020
Cash balance according to bank statement P7,735.00
Add deposits in transit not recorded by bank 425.00
P8,160.00
Deduct outstanding checks 1,860.00
Adjusted balance P6,300.00

Cash balance according to company's records P4,098.00

Add: Note collected by bank, principal P 2,400.00
Interest 75.00 P2,475.00
Error in recording cash sales of P742 as P724 18.00 2,493.00
P6,591.00
Deduct: NSF check from Janice Sinco P 256.00
Bank service charges 35.00 291.00
Adjusted balance P6,300.00
Entries:
Cash 2,493.00 Accounts receivable 256.00
Notes receivable 2,400 Miscellaneous Administrative Expense 35.00
Interest income 75.00 Cash 290.00
Sales 18.00

PROBLEM 2. 9 pts
a. Petty Cash 350.00 b Office Supplies Expense 89.50
Cash 350.00 Miscellaneous Administrative Expense 108.75
Miscellaneous Selling Expense 65.60
c Petty Cash 50.00 Cash Short and Over 10.35
Cash 50.00 Cash 274.20