QUIZ # 1 ANSWERS

1A

Theories

1. D
2. A
3. D
4. B
5. A
6. A
7. B
8. D
9. B
10. B

Computational

11. C (35,000 + 75,000 + 350,000) = 460,000

Cash on hand 400,000

Cash in Bank – current account (1.2M + 30K stale check) 1,230,000

Cash in Bank – peso savings deposit (5M – 800K bond) 4,200,000

Cash in Bank – dollar (unrestricted) ($100K x ₱45) 4,500,000

Cash in money-market account 500,000

3-month unrestricted time deposit ($20K x ₱45) 900,000

Treasury note, purchased 12/1/20x1, maturing 2/28/20x2 400,000

Redeemable P/S, purchased 12/1/20x1, due on 3/1/20x2 740,000

Cash and cash equivalents - adjusted balance 12,870,000

12. D

13. B

14. B
Solution:

July 31, Office supplies expense 4,200

20x1
Transportation expense 10,500

Repairs and maintenance 3,000

 Miscellaneous expense 9,000

Receivable from custodian 1,800

Petty cash fund 28,500

15. E
Solution:
Coins and currencies 2,550

Check drawn to the order of the PCF custodian 3,000

Petty cash vouchers:

Gasoline for delivery equipment 3,000

Medical supplies for employees 2,040 5,040

IOU’s:

Advances to employees 2,220

Total as accounted (cash count) 12,810

Total accountability (ledger balance) (15,000)

Shortage ( 2,190)

The entry to record the replenishment is as follows:

Dec. 31, Transportation expenses 3,000

20x1
Medical supplies 2,040

Advances to employees 2,220

Cash short or over 2,190

Cash in bank 9,450

16. C
Solution:

Checking account #101 175,000

Checking account #201 (10,000)

Money market account 25,000

90-day certificate of deposit, due 2/28/04 50,000

 Cash and cash equivalents 240,000

17. A – (740 + 240 + 230 + 170 + 8 + 8 = 1,396 per count – 1,400 accountability) = 4 shortage
18. A
Solution:

Balance per bank statement, 12/31/x1 38,075

Deposit in transit, 12/31/x1 5,200

Outstanding checks, 12/31/x1 (6,750)

Amount erroneously credited by bank to ABC's account, 12/28/x1 (400)

Adjusted balance 36,125

19. D
Solution:
18,050 + 3,250 – 2,750 = 18,550

20. -

21. -

22. -
23. C (See solutions below)

24. A (See solutions below)

25. A (See solutions below)

Solutions:

Per books

30-Jun Receipts Disbursements 31-Jul

Balance per books 5,600 30,700 27,000 9,300

Note collected by bank:

June 2,250 (2,250)

July 3,000 3,000

 Bank service charges

June (20) (20)

July 100 (100)

NSF checks: (880) (880)

June 1,400 (1,400)

July

Book errors:

June 1,900 (1,900)

July 1,200 1,200

Adjusted balances 8,850 30,750 27,600 12,000

Per bank

30-Jun Receipts Disbursements 31-Jul

Balance per bank 10,200 27,900 21,300 16,800

Deposits in transit

June 6,000 (6,000)

July 11,250 11,250

Outstanding checks

June (9,750) (9,750)

July 17,850 (17,850)

Bank errors:

June 2,400 (2,400)

July (1,800) 1,800

Adjusted balances 8,850 30,750 27,600 12,000

26.