BALIWAG, DANNICA C.

2BSA1

ACTIVITY 1 - INTERMEDIATE ACCOUNTING 1

CASH & CASH EQUIVALENTS AND BANK RECONCILIATION

Problem 1: Cash and Cash Equivalents of 2BSA1 Co.

Cash and Cash Equivalents Adjustments

Cash on Hand P 450,000 Cash on Hand 450,000
Cash in bank – Current Account 2,150,000 2,150,000
Cash in Bank – Peso Savings Deposit 5,200,000 Cash in Bank – Peso Savings Deposit 5,200,000
Compensating Balance (95,000)
5,105,0000
Total Cash and Cash Equivalents P 7,705,000

Problem 2: Transactions relating to the petty cash fund of 2BSA2 Co.

(1) Journal Entries

Debit Credit
Aug 01 Petty Cash Fund 50,000
Cash in Bank 50,000
To record establishment of the fund

30 Office supplies expense 7,330

Transportation expense 13,559
Communication expense 3,406
Freight - Out 15,586
Cash in Bank 39,881
To record disbursements made

30 Cash in Bank 884

Cash Over 884
To record cash overage of petty cash fund

(2) Petty Cash Fund P 50,000

Expenses (39,881)
P 10,119

The amount of petty cash that will be reported on December 31, 2023 is P 10,119.
Problem 3: LSPU Co. November 30, 2023 bank reconciliation

LSPU Co.
Bank Reconciliation
November 30, 2023
Balance per Book P 9,525
Add: Collection of Notes Receivable 5,000
Interest Income 500
Book Error 171 5,671
Total 15,196
Less: NSF check 3,200
Service Charge 52 (3,252)
Adjusted Book Balance 11,944

LSPU Co.
Bank Reconciliation
November 30, 2023
Balance per Bank P 14,597
Add: Deposit in Transit 3,017
Bank Error 2,500 5,517
Total 20,114
Less: Outstanding Checks 3,120
Unreleased Checks 5,050 (8,170)
Adjusted Book Balance 11,944

Adjusting Entries:
Debit Credit
Cash 5,500
Notes Receivable 5,000
Interest Income 500
To record collection of notes receivable by bank

Cash 171
Book Error 171
To record book error

Accounts Receivable 3,200

Cash 3,200
To record NSF check

Bank Service Charge 52

Cash 52
To record payment of bank service charge