Question

Broadway Enterprises has received its bank statement as at March 31, 2019 which showed a balance...

Broadway Enterprises has received its bank statement as at March 31, 2019 which showed a balance of $15,180. Meanwhile its Cash book balance at March 31, 2019 stood $8,140. In addition, the Accountant of Broadway Enterprises was presented with the following information: 1. Bank charges for the month were shown as $250 as per bank statement. 2. Cheques issued to two creditors-Alloy Limited for $900 (cheque #253) and Ben Lion for $270 (cheque #258) were not presented to the bank and remain outstanding. 3. Ali Brown, a customer deposited a cheque in the amount of $2,500 directly into Broadway Enterprises’ bank account that was not recorded in the cash book. 4. Proceeds of a matured Note receivable was received by the bank in the amount of $5,800, including interest of $800. 5. A cheque in the amount of $180 received from a customer, Barry Duke was returned by the bank marked as Not Sufficient Funds. 6. The bank erroneously posted a cheque in the amount of $2,000 (cheque #1123) issued by Broadway Limited in Broadway Enterprises’ account. 7. During the evening of March 31, a deposit of $2,000 was placed in the night deposit box at the bank after closing hours; this is not shown on the bank statement. You are required to:

(a) Prepare the relevant journal entries; and

(b) Prepare the Bank Reconciliation Statement for Broadway Enterprises as at March 31, 2019.

Homework Answers

Answer #1

Solution a:

Journal Entries - Broadway Enterprises
Date Particulars Debit Credit
31-Mar Cash Dr $2,500.00
       To Account receivables $2,500.00
(To record collection of receivables)
31-Mar Cash Dr $5,800.00
       To Note receivables $5,000.00
       To Interest revenue $800.00
(To record note collection by bank)
31-Mar Miscellenaeous expense Dr $250.00
       To Cash $250.00
(Being service charge debited by bank)
31-Mar Accounts receivables Dr $180.00
       To Cash $180.00
(To record NSF check from customer)

Solution b:

Broadway Enterprises
Bank Reconciliation - March 31
Bank's Cash balance Company's cash balance
Particulars Amount Particulars Amount
Ending balance as per Bank Statements $15,180.00 Ending Balance as per cash books $8,140.00
Additions: Additions:
Outstanding Deposits $2,000.00 Bank collection $2,500.00
Note collection (including interest) $5,800.00
Deductions: Deductions:
Outstanding Checks $1,170.00 Service Charge $250.00
NSF Cheque $180.00
Up to date cash balance as per bank $16,010.00 Up to date cash balance as per books $16,010.00
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
March 31, 2019Balance on bank statementAdditions:Deductions:Total deductionsAdjusted bank balanceBalance in booksAdditions:Deductions:Adjusted book balance Di Stefano Office...
March 31, 2019Balance on bank statementAdditions:Deductions:Total deductionsAdjusted bank balanceBalance in booksAdditions:Deductions:Adjusted book balance Di Stefano Office Supply Company received a bank statement showing a balance of $70,005 as of March 31, 2019. The firm’s records showed a book balance of $71,487 on March 31. The difference between the two balances was caused by the following items. A debit memorandum for $40, which covers the bank’s collection fee for the note (item 6). A deposit in transit of $4,700. A check...
SNM Sdn Bhd received its bank statement for the month of March 2020 from BCB Bank....
SNM Sdn Bhd received its bank statement for the month of March 2020 from BCB Bank. The bank statement shows a balance of RM520,200 while SNM Sdn Bhd cash book balance shows a balance of RM512,750 on 31 March 2020. A comparison of the bank statement with the cash book reveals the following information. Cheque number 1444 for RM2,000 and cheque number 1501 for RM2,900 are still outstanding on the 31 March 2020. The bank statement indicates that BCB Bank...
Odum Corporation’s cash account showed a balance of $17,100 on March 31, 2016. The bank statement...
Odum Corporation’s cash account showed a balance of $17,100 on March 31, 2016. The bank statement balance for the same date indicated a balance of $17,821.55. The following additional information is available concerning Odum’s cash balance on March 31: • Undeposited cash on hand on March 31 amounted to $724.50. • A customer’s NSF check for $175.80 was returned with the bank statement. • A note for $2,000 plus interest of $25 was collected for Odum by the bank during...
Di Stefano Office Supply Company received a bank statement showing a balance of $67,805 as of...
Di Stefano Office Supply Company received a bank statement showing a balance of $67,805 as of March 31, 20X1. The firm’s records showed a book balance of $69,463 on March 31. The difference between the two balances was caused by the following items. A debit memorandum for $46, which covers the bank’s collection fee for the note (item 6). A deposit in transit of $3,500. A check for $244 issued by another firm that was mistakenly charged to Di Stefano’s...
DROP OUT STORES BANK RECONCILIATION STATEMENT AT 30 APRIL 2007 Cr. Balance per bank statement R1324...
DROP OUT STORES BANK RECONCILIATION STATEMENT AT 30 APRIL 2007 Cr. Balance per bank statement R1324 Add: outstanding deposit R180 = R1 504 Less: outstanding Cheques: No. 361- R 84/ Chq366-R265/ Chq367-R80/ Chq368 - R50/ Chq370- R35 Dr. balance per cash book Balances at 31 May 2007: bank statement (favourable) R324. Cash book (dr. )R384 Items on May bank statement, but not in May cash book: 1. Deposit: R180 2. Telegraphic transfer on 20 May by debtor, W. Pay, to...
Pelzer Company reconciled its bank and book statement balances of Cash on August 31 and showed...
Pelzer Company reconciled its bank and book statement balances of Cash on August 31 and showed two cheques outstanding at that time, #5888 for $6,060 and #5893 for $1,448.00. The following information was available for the September 30, 2017, reconciliation: From the September 30, 2017, bank statement BALANCE OF PREVIOUS STATEMENT ON AUG. 31/17 10,404.00 6 DEPOSITS AND OTHER CREDITS TOTALLING 18,506.00 9 CHEQUES AND OTHER DEBITS TOTALLING 24,019.00 CURRENT BALANCE AS OF SEPT. 30/17 4,891.00 Chequing Account Transactions Date...
On 31st December, 2016 the cash book of Alavanyo Ltd. showed a debit balance of     GHS85,000...
On 31st December, 2016 the cash book of Alavanyo Ltd. showed a debit balance of     GHS85,000 and was in disagreement with the bank statement balance. The Accountant of     Alavanyo Ltd. suddenly resigned his position after identifying the following causes of the discrepancy. i. Cheques issued for GHS60,000 were not presented at the bank by 31st December, 2016. ii. Cheques for GHS80,000 were deposited in the bank but were not cleared. iii. The proceeds of a Bill Receivable of GHS200,000 collected...
Mr. Waleed has started a Plastic toys Manufacturing Company and opened a Business bank account in...
Mr. Waleed has started a Plastic toys Manufacturing Company and opened a Business bank account in Sohar Bank and every month end he checks his Cash book maintained by his accountant Mr. Asadin the company with the Bank book maintained by the banker. His Cash Book balance on 31 st December 2019, was OMR 12,500, this did not agree with the balance as shown by the Bank Pass Book. In order to know why the balances are not equal in...
On October 31, 2021, Oriole Company had a cash balance per books of $8,967. The bank...
On October 31, 2021, Oriole Company had a cash balance per books of $8,967. The bank statement on that date showed a balance of $10,165. A comparison of the statement with the Cash account revealed the following: 1. The statement included debit memos of $45 for the printing of additional company cheques and $40 for bank service charges. 2. Cash sales of $528 on October 12 were deposited in the bank. The journal entry to record the cash receipt and...
On October 31, 2021, Oriole Company had a cash balance per books of $8,967. The bank...
On October 31, 2021, Oriole Company had a cash balance per books of $8,967. The bank statement on that date showed a balance of $10,165. A comparison of the statement with the Cash account revealed the following: 1. The statement included debit memos of $45 for the printing of additional company cheques and $40 for bank service charges. 2. Cash sales of $528 on October 12 were deposited in the bank. The journal entry to record the cash receipt and...