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The bookkeeper at Hopkins Company has not reconciled the bankstatement with the

ID: 2457596 • Letter: T

Question

The bookkeeper at Hopkins Company has not reconciled the bankstatement with the Cash account, saying, “I don’t havetime.” You have been asked to prepare a reconciliation andreview the procedures with the bookkeeper.

The April 30, 2006, bank statement and the April ledger accountsfor cash showed the following (summarized):

A comparison of checks written before and during April with thechecks cleared through the bank showed outstanding checks at theend of April of $2,200. No deposits in transit were carried overfrom March, but a deposit was in transit at the end of April.

The bookkeeper at Hopkins Company has not reconciled the bank statement with the Cash account, saying, I don?t have time. You have been asked to prepare a reconciliation and review the procedures with the bookkeeper. The April 30, 2006, bank statement and the April ledger accounts for cash showed the following (summarized): A comparison of checks written before and during April with the checks cleared through the bank showed outstanding checks at the end of April of $2,200. No deposits in transit were carried over from March, but a deposit was in transit at the end of April. What was the balance in the cash account in the ledger on May1, 2006? What total amount of cash should be reported on the balance sheet at the end of April?

Explanation / Answer

          Hopkin'scompany           BankReconciliation            Apr30,2006 Balance perBank                                      18,530 Add Deposit in transit (42,000-36,000)                                            6,000 Less outstandingchecks                              (2,200) Adjusted Bank Balance, Apr30th               22,330                                                                         Cash BegBalance               23,250                                 Checks written        43,800 Deposits                     42,000                                  NSFcheck                  140 Interest collected      1,070                                  Bankfee                        50 Endingbalance            22,330                                     1. Balance in the cash account on May 1, $ 22,330 2. $ 22,330

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