Determine Cash Balance

The controller for Cache Company is attempting to determine the amount of cash and cash equivalents to be reported
on its December 31, 2017, statement of financial position. The following information is provided.

a. Commercial savings account of ₱300,000 and a commercial checking account balance of ₱400,000 are held at
Premier National Bank.
b. Money market fund account held at Joy Company (a mutual fund organization) permits Cache to write checks
on this balance, ₱2,500,000.
c. Travel advances of ₱90,000 for executive travel for the first quarter of next year (employee to reimburse through
salary reduction).
d. A separate cash fund in the amount of ₱750,000 is restricted for the retirement of long-term debt.
e. Petty cash fund of ₱500.
f. An I.O.U. from Mary Jane Gray, a company customer, in the amount of ₱75,000.
g. A bank overdraft of ₱55,000 has occurred at one of the banks the company uses to deposit its cash receipts. At
the present time, the company has no deposits at this bank.
h. The company has two certificates of deposit, each totaling ₱250,000. These CDs have a maturity of 120 days.
i. Cache has received a check that is dated January 12, 2018 in the amount of ₱62,500.
j. Cache has agreed to maintain a cash balance of ₱250,000 at all times at Premier National Bank to ensure future
credit availability.
k. Cache has purchased ₱1,050,000 of commercial paper of JG Capital Inc. which is due in 60 days.
l. Currency and coins on hand amounted to ₱3,850.

Requirements:

1. Compute the amount of cash and cash equivalents to be reported by Cache Company statement of financial
position at December 31, 2017.
2. Indicate the proper reporting for items that are not reported as cash on the December 31, 2017 statement of
financial position.

Petty Cash

The petty cash fund of Dynamic Auto Shop, a sole proprietorship contains the following:

Coins and currency ₱10.20

Postage stamps 7.90
An I.O.U. from Goldie Ginto, an employee, for cash advance 40.00
Check payable to Dynamic Auto Shop from Paula Stone, an employee,
marked NSF 34.00
Vouchers for the following:
Stamps 20.00
Two basketball tickets for Dina Dyna, owner of Dynamic Auto 170.00
Printer cleaning 14.35
Total ₱296.45

The general ledger account Petty Cash has a balance of ₱500.

Requirement: Prepare the journal entry to record the reimbursement of the petty cash fund.

Bank Reconciliation and Adjusting Entries

Charlie Ltd has just received the August 31, 2017 bank statement as summarized below.
 Agora Bank Receipts Disbursements Balance
Balance, August 1 ₱42,160.50
Deposits during August ₱144,900
Note collected for depositor, including
₱180 interest 4,680
Checks cleared during August ₱155,250
Bank service charges 90
Balance, August 31 ₱36,400.50

The general ledger Cash account contained the following entries for the month of August.

CASH
Balance, August 1 P 45,225 Disbursements in August P159,313.50
Receipts during August 157,500

Deposits in transit and check outstanding at August 31 are ₱17,163 and ₱6,975, respectively. Cash on hand at August
31 is ₱1,395. The bookkeeper improperly entered one check in the books at ₱535.10 which was written for ₱553.10
for supplies (expense). This check cleared the bank during the month of August.

Requirements:

1. Prepare the August bank reconciliation.

2. Prepare the necessary journal entries to correct the Cash account.
3. What amount of cash should be reported in the August 31 statement of financial position?

Petty Cash and Bank Reconciliation

Jane Cooper is reviewing the cash accounting for Mambo Inc., a local logistics and delivery service outfit. Cooper’s
review will focus on the petty cash account and the bank reconciliation for the month ended May 31, 2017. She has
collected the following information from Mambo’s bookkeeper for this task.

Petty Cash

a. The petty cash fund was established on May 10, 2017 in the amount of ₱1,000.
b. Expenditures from the fund by the custodian as of May 31, 2017 were evidenced by approved receipts for the
following:
I.O.U. from employees ₱120
Mailing labels and other supplies 260
Newspaper advertising 91.20
Postage expense 132
Shipping charges 229.80
Miscellaneous expense 61.40

c. On May 31, 2017, the petty cash fund was replenished and increased to ₱1,200; currency and coins in the fund
at that time totaled ₱105.60.

Bank Reconciliation

Orion Bank
Bank Statement
Receipts Disbursements Balance
Balance, May 1, 2017 ₱8,769
 Deposits ₱28,000
Note payment direct from customer (interest
of ₱30) 930
Checks cleared during May ₱31,150
Bank service charges 27
Balance, May 31, 2017 ₱6,522

Mambo’s Cash Account

Balance, May 1, 2017 ₱ 8,850

Deposits during May 2017 31,000
Checks written during May 2017 31,835

Deposits in transit are determined to be ₱3,000 and checks outstanding at May 31 total ₱850. Cash on hand (besides
petty cash) at May 31, 2017 is ₱246.

Requirements:

1. Prepare the journal entries to record the transactions related to the petty cash fund for May.
2. Prepare the May bank reconciliation and prepare all necessary journal entries to make the books correct and
complete.
3. What amount of cash should be reported in the May 31, 2017 statement of financial position?

Proof of Cash

Triple V Corporation began doing business with Metro Bank on October 1. On that date, the correct cash balance
was ₱4,000. All cash transactions are cleared through the bank account. Subsequent transactions during October and
November relating to the record of Triple V and Metro Bank are summarized below:

Triple V Metro Bank

Books Books
October deposits Php3,680 Php3,555
October checks 3,145 3,065
October service charge 0 5
October 31 balance 2,535 2,485
November deposits 4,110 4,140
November checks 4,705 4,610
November service charge 0 7.5
Note collected by bank in November (included P15
interest) 0 507.5
October service charge recorded in November 5 0
November 30 balance 1,935 2,515

Requirements:
1. Prepare a four-column reconciliation for the month ended November 30, reconciling both bank and book balances
to a corrected balance.
2. Prepare all the necessary entries to adjust the cash account of Triple V.