Solution - Albania Company

Cash in bank 3,000,000

Time deposit – 30 days 1,000,000
Petty cash fund 20,000
I. Postdated Check (200,000)
II. Undelivered Check 250,000
III. Postdated Check 100,000
V. (450,000)
Cash and Cash Equivalents 3,720,000

Solution - Argentina Company

Cash on hand (1,000,000 – 150,000) 850,000
Petty cash fund (50,000 – 10,000 – 5,000) 35,000
Security Bank current account 2,000,000
PNB current account 1,500,000
Bond sinking fund (CA to CL) 2,500,000
Cash and Cash Equivalents 6,885,000

Solution - Armenia Company

Total Cash – Unadjusted 7,050,000
I. a. Customer NSF check (100,000)
b. Customer postdated check (150,000)
II. (10,000 + 5,000) PCF (15,000)
III. Check written undelivered 200,000
IV. Check written postdated 300,000
Total Cash – Adjusted 7,285,000

Solution - Callous Company

Cash and Cash Equivalents – Unadjusted 11,370,000
I. a. Customer check NSF (35,000)
b. Customer check postdated (15,000)
II PCF 5,000 only left (15,000)
III. a. Check written undelivered 25,000
b. Check written postdated 45,000
Cash and Cash Equivalents – Adjusted 11,375,000

Solution - Apathy Company

Book Bank
Unadjusted Balance 65,000 108,000
Credit Memo 30,000
Debit Memo (2,000)
Deposit in Transit 80,000
Outstanding Check (95,000)
Adjusted Balance 93,000 93,000

Unadjusted Book Balance = 240,000 – 175,000 = 65,000

CM - Dec. 29 30,000
DM - Dec. 31 2,000
DIT - Dec. 31 80,000
OC - Check No. 102, 105 and 107 95,000

Solution - Sensible Company

Book Bank
Unadjusted Balance 110,000 135,000
Credit Memo 45,000
Debit Memo (15,000)
Deposit in Transit 60,000
Outstanding Check (90,000)
Book Error (27,000)
Bank Error 8,000
Adjusted Balance 113,000 113,000
Unadjusted Book Balance = 280,000 – 170,000 = 110,000
Unadjusted Bank Balance = 130,000 – 160,000 + 165,000 = 135,000
CM - Dec. 28 45,000
DM - Dec. 28 (10,000 + 5,000) = 15,000
DIT - Dec. 31 60,000
OC - Check No. 770, 775 and 777 = 90,000

Book Error
Entry Made Should Be Entry Adjusting Entry
A/P 25,000 A/P 52,000 A/P 27,000
Cash 25,000 Cash 52,000 Cash 27,000

Bank Error - Check No. 1042 8,000

Solution - Sassy Company

June 30 July Receipts July Disbursements July 31
Balance per book 1,000,000 4,000,000 3,600,000 1,400,000
CM - Previous Month 300,000 (300,000)
CM - Current Month 500,000 500,000
DM - Previous Month (100,000) (100,000)
(4,000) (4,000)
DM - Current Month 1,000 (1,000)
Book Errors
Adjusted book balance 1,196,000 4,200,000 3,497,000 1,899,000

June 30 July Receipts July Disbursements July 31

Balance per bank 1,650,000 3,500,000 2,500,000 2,650,000
DIT - Previous Month 400,000 (400,000)
DIT - Current Month 1,100,000 1,100,000
OC - Previous Month (854,000) (854,000)
OC - Current Month 1,851,000 (1,851,000)
Bank Errors
Adjusted bank balance 1,196,000 4,200,000 3,497,000 1,899,000

Deposits in transit - June 30 400,000

Cash receipts deposited during the month 4,200,000 Adjusted Book Receipts
Deposits acknowledged by bank during the month (3,500,000)
Deposits in transit - July 31 1,100,000

Outstanding checks - June 30 854,000

Checks drawn by depositor during the month 3,497,000 Adjusted Book Disbursements
Checks paid by the bank during the month (2,500,000)
Outstanding checks - July 31 1,851,000

Solution - Beehive Company

October 31 Nov. Receipts Nov. Disbursements November 30
Balance per book 600,000 2,200,000 1,800,000 1,000,000
CM - Previous Month
CM - Current Month
DM - Previous Month
DM - Current Month
Book Errors 90,000 90,000
270,000 (270,000)
Adjusted book balance 600,000 2,290,000 2,070,000 820,000
 October 31 Nov. Receipts Nov. Disbursements November 30
Balance per bank 400,000 2,500,000 1,970,000 930,000
DIT - Previous Month 300,000 (300,000)
DIT - Current Month 190,000 190,000
OC - Previous Month (100,000) (100,000)
OC - Current Month 400,000 (400,000)
Bank Errors (100,000) (100,000)
(200,000) 200,000
Adjusted bank balance 600,000 2,290,000 2,070,000 820,000

Notes: No CM and DM given

Deposits in transit - October 31 300,000
Cash receipts deposited during the month 2,290,000 Adjusted Book Receipts
Deposits acknowledged by bank during the month (2,400,000) (2,500,000 – 100,000)
Deposits in transit - November 30 190,000

Outstanding checks - October 31 100,000 Squeeze

Checks drawn by depositor during the month 2,070,000 Adjusted Book Disbursements
Checks paid by the bank during the month (1,770,000) (1,970,000 – 200,000)
Outstanding checks - November 30 400,000