Intermediate Accounting 1

Petty Cash Fund & Bank Reconciliation

1. The petty cash fund of P200 for Colin Company appeared as follows on December 31,2023:
Cash P95.60
Petty cash vouchers
Freight in P19.40
Postage 40.00
Balloons for a special occasion 18.00
Meals 25.00

Required:
1. Briefly describe when the petty cash fund should be replenished. Because there is cash on hand, is
there a need to replenish the fund at year end on December 31? Explain.
2. Prepare in general journal form the entry to replenish the fund.
3. On December 31, the oUice manager gives instructions to increase the petty cash fund by P100.
Make the appropriate journal entry.

2. Dengue Company has a petty cash fund with an imprest balance of P10,000. On the balance sheet date,
the following items were seen on the petty cash drawer:
Bills 500
Coins 30
Expense Receipts
Xerox 1,200
Transportation 600
Representation 2,900
Postdated check from an employee 1,000
Employee check marked NSF 1,500
IOU from employee 2,500
Required:
1. How much is the petty cash shortage or overage?
2. How much is the balance of the Petty Cash Fund?

3. Apathy corporation provided the following information:

Apathy Company
Month of December
Date Check Withdrawal Deposit Balance
2 100,000 100,000
18 104 10,000 90,000
20 101 5,000 85,000
22 106 25,000 60,000
27 50,000 110,000
29 10,000 120,000
29 108 40,000 80,000
29 CM 30,000 110,000
31 DM / SC 2,000 108,000

Intermediate Accounting 1 – Cash and Cash Equivalents Part 2

 First Bank
Date Deposit Date Check Amount
1 100,000 4 101 5,000
21 50,000 6 102 15,000
27 10,000 8 103 40,000
31 80,000 8 104 10,000
10 105 30,000
14 106 25,000
28 107 50,000
The credit made by the bank on December 29 represents the proceeds of a note receivable from a
customer which was given to the bank for collection by the entity on December 26.
Required:
1. Prepare bank reconciliation using the adjusted method.
2. Prepare the adjusting entries.

4. The following data were taken from the cash journals of Xantous Company:
Cash Receipts Journal Cash Disbursement Journal
Date Debit cash Check No. Credit cash
Feb 2 2,000,000 117 200,000
6 400,000 118 900,000
9 800,000 119 800,000
10 200,000 120 50,000
15 1,200,000 121 550,000
20 1,300,000 122 180,000
24 550,000 123 1,000,000
28 450,000 124 120,000
125 250,000
6,900,000 4,500,000

The following information was taken from the credit memo of February 28:
Face of the note 250,000
Interest in the note 30,000
Maturity value of the note 280,000
Collection charge 10,000
Credit to your account 270,000
Required: Prepare bank reconciliation on February 28, showing the book balance before and after
adjustments.

5. Endemic company provided the following data for the purpose of reconciling the cash balance per
book with the cash balance per bank statement on December 31.
Balance per bank statement P 2,000,000
Balance per book 850,000
Outstanding check, including certified check of P100,000 500,000
Deposit in transit 200,000
December NSF check, of which P50,000 had been redeposited and cleared by 150,000
December 27

Intermediate Accounting 1 – Cash and Cash Equivalents Part 2

 Erroneous credit to Endemic account representing proceeds of loan granted to another 300,000
entity
Proceeds of note collected by bank for endemic net of service charge of P20,000 750,000
Required: What is the cash balance to be reported on December 31?

6. Adversary Company kept all cash in a checking account. an examination of the accounting records and
bank statement for the month of June revealed the following information:
• The cash balance per book on June 30 is P8,500,000.
• A deposit of P1,000,000 that was placed in the bank’s night depository on June 30 does not appear
on the bank statement.
• The bank statement shows on June 30, the bank collected note for Adversary company and credited
the proceeds of P950,000 to the entity’s account.
• Check outstanding in June 30 amount to P300,000.
• Adversary Company discovered that a check written in June for P200,000 in payment of an account
payable had been recorded in the entity’s records as P20,000.
• Included with the June bank statement was NSF check for P250,000 that Adversary Company had
received from customer on June 26.
• The bank statement shows a P20,000 service charge for June.
Required: What is the cash in bank to be reported in the statement of financial position on June 30?

7. Timex Company provided the following data relating to the cash transactions and bank account for the
month of July:
Cash balance per ledger ?
Cash balance per bank statement ?
Debit memo for July service charge 5,000
Deposit of July 31 not recorded by bank until August 1 450,000
Outstanding check, including certified check of P50,000 750,000
Proceeds from bank loan not recorded in the ledger 500,000
Proceeds from customer note, face P400,000 collected by bank, collection fee of P15,000 435,000
A creditor check had been entered in the book as P20,000 and was erroneously deducted 200,000
by bank at
A customer check was returned by bank DAIF 50,000
Correct cash balance 3,000,000
Required:
1. What is the cash balance per ledger?
2. What is the cash balance per bank statement?

Intermediate Accounting 1 – Cash and Cash Equivalents Part 2