PROBLEM 3-1 SASSY COMPANY PROBLEM 3-2 BEEHIVE COMPANY

Bank Reconciliation, June 30

November 30:
Balance per book, Oct 31 600,000
Balance per book 1,000,000
Book debits 2,200,000
Note collected 300,000
Book credits (1,800,000)
NSF check (100,000)
Balance per book, Nov. 30 1,000,000
Service charge (4,000)
Adjusted book balance 1,196,000
Balance per bank, Oct 31 (Squeeze) 400,000
Bank credits 2,500,000
Balance per bank 1,650,000
Bank debits (1,970,000)
Deposits in transit 400,000
Balance per bank, Nov. 30 930,000
Outstanding checks (854,000)
Adjusted bank balance 1,196,000
Deposits in transit, Oct 31 300,000
Book debits 2,200,000
July 31:
Understated collection 90,000 2,290,000
Computation of book balance:
Bank credits 2,500,000
Balance, June 30 1,000,000
Credit memo (100,000) (2,400,000)
Book debits, July 4,000,000
Deposits in transit, Nov. 30 190,000
Book credits (3,600,000)
Book balance, July 31 1,400,000
Outstanding checks, Oct 31 (Squeeze) 100,000
Book credits 1,800,000
Computation of bank balance:
Understated check 270,000 2,070,000
Balance, June 30 1,650,000
Bank debits 1,970,000
Bank credits, July 3,500,000
Debit memo (200,000) (1,770,000)
Bank debits (2,500,000)
Outstanding checks, Nov. 30 400,000
Bank balance, July 31 2,650,000
Bank Reconciliation, November 30:
Computation of deposits in transit:
Balance per book 1,000,000
Deposits in transit, June 30 400,000
Understated collection 90,000
Book debits 4,000,000
Understated check (270,000)
Credit memo (300,000) 3,700,000
Adjusted book balance 820,000
Bank credits 3,500,000
Credit memo (500,000) (3,000,000)
Balance per bank 930,000
Deposits in transit, July 31 1,100,000
Deposits in transit 190,000
Outstanding checks (400,000)
Computation of outstanding checks:
Check of Beeline Company 200,000
Outstanding checks, June 30 854,000
Erroneous credit (100,000)
Book credits 3,600,000
Adjusted bank balance 820,000
Debit memo (104,000) 3,496,000
Bank debits 2,500,000
Adjusting Entries, Nov. 30:
Debit memo (1,000) (2,499,000)
Cash in bank 90,000
Outstanding checks, July 31 1,851,000
Accounts Receivable 90,000
Accounts Payable 270,000
Bank Reconciliation, July 31
Cash in bank 270,000
Book balance, July 31 1,400,000
Proceeds of bank loan 500,000
Bank Reconciliation, October 31:
Service charge (1,000)
Balance per bank 400,000
Adjusted book balance 1,899,000
Deposits in transit 300,000
Outstanding checks (100,000)
Bank balance, July 31 2,650,000
Adjusted bank balance 600,000
Deposits in transit 1,100,000
Outstanding checks (1,851,000)
Balance per book 600,000
Adjusted bank balance 1,899,000
Adjusted book balance 600,000

Adjusting Entries, July 31:

Cash in bank 500,000
Loans receivable 500,000
Bank service charge 1,000
Cash in bank 1,000
PROBLEM 3-3 FABULOUS COMPANY PROBLEM 3-4 FLAMBOYANT COMPANY
Balance per book, Oct 31 990,000
July 31: Book debits 710,000
Book balance, July 1 1,270,000 Book credits (1,200,000)
Book debits 3,400,000 Balance per book, Nov. 30 500,000
Book credits (4,200,000)
Book balance, July 31 470,000 Balance per bank, Oct 31 1,100,000
Bank credits 500,000
Bank balance, July 1 (squeeze) 1,720,000 Bank debits (1,000,000)
Bank credits 5,000,000 Balance per bank, Nov. 30 600,000
Bank debits (4,020,000)
Bank balance, July 31 2,700,000 Deposits in transit, beg 45,000
Book debits 710,000
Bank Reconciliation, July 31: Cash receipt (100,000)
Bank balance, July 31 2,700,000 Deposits outs. (45,000) 565,000
Deposits in transit 400,000 Bank credits 500,000
Outstanding checks: Error (10,000) (490,000)
No. 107 650,000 Deposits in transit, Nov 30 120,000
No. 108 500,000 (1,150,000)
Adjusted bank balance 1,950,000 Outstanding checks, beg 125,000
Book credits 1,200,000
Book balance, July 31 470,000 Debit memo (5,000) 1,195,000
Note collected 1,500,000 Bank debits 1,000,000
Service charge (20,000) Debit memo (60,000) (940,000)
Adjusted book balance 1,950,000 Outstanding checks, Nov 30 380,000

Adjusting Entries, July 31: Bank Reconciliation, November 30:

Cash in bank 1,500,000 Book balance 500,000
Notes Receivable 1,500,000 Book error (100,000)
Bank service charge 20,000 NSF check (50,000)
Cash in bank 20,000 Service charge (10,000)
Adjusted book balance 340,000
Bank Reconciliation, July 1:
Bank balance, July 1 1,720,000 Bank balance 600,000
Deposits in transit 500,000 Deposits in transit 120,000
Outstanding checks (950,000) Outstanding checks (380,000)
Adjusted bank balance 1,270,000 Adjusted bank balance 340,000

Book balance, July 1 1,270,000 Adjusting Entry:

Adjusted book balance 1,270,000
Accounts Receivable 10,000
Service charge 10,000
Notes receivable 100,000
Cash in bank 120,000
PROBLEM 3-7 BEDLAM COMPANY

November 30 Receipts Disbursements December 31

Balance per book 2,032,000 2,568,000 1,440,000 3,160,000
Bank service charge
November (2,000) (2,000)
December 4,000 (4,000)
Note recorded as cash
receipt
November (200,000) 200,000
December (300,000) (300,000)
Adjusted book balance 1,830,000 2,468,000 1,442,000 2,856,000

November 30 Receipts Disbursements December 31

Balance per bank 1,890,000 2,090,000 1,080,000 2,900,000
Deposits in transit
November 80,000 (80,000)
December 498,000 498,000
Outstanding checks
November (180,000) (180,000)
December 592,000 (592,000)
Adjusted bank balance 1,830,000 2,468,000 1,442,000 2,856,000

Adjusting Entries, December 31:

Bank service charge 4,000

Notes Receivable 300,000
Cash in bank 304,000

PROBLEM 3-8 JARGON COMPANY

September 30 Receipts Disbursements October 31
Balance per book 1,900,000 1,400,000 2,400,000 900,000
Collections of A/R
September 30,000 (30,000)
October 50,000 50,000
NSF check
September (60,000) (60,000)
October 40,000 (40,000)
Overstated check
September 90,000 (90,000)
October (120,000) 120,000
Adjusted book balance 1,960,000 1,330,000 2,260,000 1,030,000

September 30 Receipts Disbursements October 31

Balance per bank 2,100,000 1,200,000 2,500,000 800,000
Deposits in transit
September 130,000 (130,000)
October 260,000 260,000
Outstanding checks
September (270,000) (270,000)
October 30,000 (30,000)
Adjusted bank balance 1,960,000 1,330,000 2,260,000 1,030,000

Adjusting Entries, October 31:

Cash in bank 50,000
Accounts Receivable 50,000
Accounts Receivable 40,000
Cash in bank 40,000
Cash in bank 120,000
Salaries Payable 120,000