Question

Use the following information for Woods Paper Products. Deposit of $12,300 has not been recorded by...

Use the following information for Woods Paper Products.

  1. Deposit of $12,300 has not been recorded by the bank
  2. Outstanding checks totaled of $19,427.
  3. Company Cash balance is $166,436 as of Nov. 30.
  4. Bookkeeper recorded a $4,000 check as $400 in payment of the current month's rent
  5. Bank balance at Nov. 30, 2018 was $195,688.
  6. A check written for $195 had been erroneously charged by the bank as $915
  7. The bank collected $26,500, on a $25,000 note, including interest of $1,500.
  8. Bank service charge is $55.

Required:

1.    Prepare the bank reconciliation for Woods Paper Products as of November 30, 2018.

2.    Prepare the necessary journal entries.

Bank Reconciliation

Journal

DATE

ITEM

PR

DEBIT

CREDIT

PROBLEM THREE              

Discuss the specific characteristics of an effective system of internal control for purchases and payment. Use complete sentences.

Business   Accounting   
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Answer #1
ans 1
Bank Reconcilaition
For the month ended nov 30
Unadjusted balance as per bank , Nov 30 $195,688
Add: deposit in transit 12300
Error made by bank (915-195) 720 13020
$208,708
Less: Outstanding checks 19427 -19427
Adjusted balance as per bank , Nov 30 $189,281
Unadjusted balance as per books , Nov 30 $166,436
Add: Collection of note including interest 26500
Less:
error made in recording of check (4000-400) 3600
Bank service charges 55 -3655
adjusted balance as per books , Nov 30 $189,281
ans 2
Date Item Dr Cr
30-Nov Cash $26,500
Notes Receivable $25,000
Interest Revenue 1500
(being note matured recorded)
30-Nov Miscelleneous expenses/Bank service charges 55
Cash 55
30-Nov Rent payable 3600
Cash 3600
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