Question

An examination of the cash activities during the year shows the following. GREAT ADVENTURES Cash Account Records July 1, 2021, to December 31, 2021 Cash Receipts Cash Disbursements Date Desc. Amount Date Check# Desc. Amount 7/1 Stock sale $ 30,000 7/1 101 Insurance $ 5,400 7/15 Clinic receipts 1,800 7/2 102 Legal fees 1,750 7/22 Clinic receipts 2,760 7/7 DC Advertising 350 7/30 Clinic receipts 3,600 7/8 103 Bikes 12,500 8/1 Borrowing 35,000 7/24 DC Advertising 750 8/10 Clinic receipts 5,100 8/4 104 Kayaks 35,000 8/17 Clinic receipts 11,900 8/24 DC Office supplies 1,850 9/21 Clinic receipts 13,700 9/1 105 Rent 3,000 10/17 Clinic receipts 18,400 12/8 106 Race permit 1,250 12/15 Race receipts 30,000 12/16 107 Salary 2,000 12/31 108 Dividend 3,000 12/31 109 Dividend 3,000 $ 152,260 $ 69,850 Summary of Transactions Beginning Ending Cash Balance Cash Balance July 1, 2021 + Cash Receipts − Cash Disbursements = December 31, 2021 $ 0 $ 152,260 $ 69,850 $ 82,410 Suzie has not reconciled the company’s cash balance with that of the bank since the company was started. She asks Summit Bank to provide her with a six-month bank statement. To save time, Suzie makes deposits at the bank only on the first day of each month. SUMMIT BANK Member FDIC Leading You to the Top Account Holder: Great Adventures, Inc. Account Number: 1124537774 Statement Date: Dec. 31, 2021 Account Summary Beginning Balance Deposits and Credits Withdrawals and Debits Ending Balance July 1, 2021 No Total No Total December 31, 2021 $0 8 $122,560 11 $61,950 $60,610 Account Details Deposits and Credits Withdrawals and Debits Daily Balance Date Amount Desc. Date No. Amount Desc. Date Amount 7/1 $ 30,000 DEP 7/1 101 $ 5,400 CHK 7/1 $ 24,600 8/1 8,160 DEP 7/7 102 1,750 CHK 7/7 22,500 8/1 35,000 DEP 7/7 350 DC 7/14 10,000 9/1 17,000 DEP 7/14 103 12,500 CHK 7/24 9,250 9/30 100 INT 7/24 750 DC 8/1 52,410 10/1 13,700 DEP 8/9 104 35,000 CHK 8/9 17,410 11/1 18,400 DEP 8/24 1,850 DC 8/24 15,560 12/31 200 INT 9/2 105 3,000 CHK 9/1 32,560 9/30 50 SF 9/2 29,560 12/10 106 1,250 CHK 9/30 29,610 12/31 50 SF 10/1 43,310 11/1 61,710 12/10 60,460 $ 122,560 $ 61,950 12/31 $ 60,610 Desc. DEP Customer deposit INT Interest earned SF Service fees CHK Customer check DC Debit card After comparing the two balances, Suzie has some concern because the bank’s balance of $60,610 is substantially less than the company’s balance of $82,410. 2-a. Prepare Great Adventures’ bank reconciliation for the six-month period ended December 31, 2021. (Amounts to be deducted should be indicated with a minus sign. Total entries to the same account together when entering in the bank reconciliation.) 2-b. Record any necessary entries to adjust cash. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Total entries to the same account together when entering in the journal entry carousel.)

Answer 1