n preparing its August 31, 2011 bank reconciliation, Acme Corp. has available th

Question

n preparing its August 31, 2011 bank reconciliation, Acme Corp. has available the following information Balance per bank statement, 8/31/11 Deposit in transit, 8/31/11 Return of customer's check not sufficient funds, 8/30/10 Outstanding checks, 8/31/11 Bank service charges for August $21,650 3,900 2,750 100 At August 31, 2011, Acme's adjusted cash balance is A) $22,100. B) $20,500. C) $22,200. D) $22,800. 18. For companies that use a perpetual inventory system, all of the following are purposes for taking a physical inventory except: A) to check the accuracy of the records. B) to determine ownership of the goods. C) to determine losses due to employee theft. D) to determine the amount of wasted raw materials. 19. When a note receivable is dishonored A) interest revenue is never recorded. B) bad debts expense is recorded. C) Accounts Receivable is debited if eventual collection is expected. D) the maturity value of the note is written off. 20. The retailer considers Visa and MasterCard sales as A) cash sales. B) promissory sales. C) contingent sales. D) credit sales. the following to answer question 21: ndy Shutters has the following inventory information. 1 Inventory 8 Purchase 17 Purchase 25 Purchase 15 units @ $6.00 60 units $6.45 30 units @ $6.30 45 units@ $6.60 1. A physical count of merchandise inventory on November 30 reveals that there are 50 units on hand. Assume a periodic inventory system is used. Ending inventory under FIFO is A) S647. B) $316. C) $329. D) $634. 22. Having one person responsible for the related activities of ordering merchandise, receiving goods, and paying for them A) is a good example of safeguarding the company's assets. B) is an example of good internal control C) increases the potential for errors and fraud. D) decreases the potential for errors and fraud.

Explanation / Answer

Answer 17-D. $22,800 Acme Corp. Bank Recocilation Aug 31, 2011 Bank's Cash Balance Per Bank Statement     21,650.00 Add: Deposit not recorded by bank       3,900.00     25,550.00 Less: Outstanding Checks:     (2,750.00) Bank Balance after Reconcilation     22,800.00 Answer 18-B. to determine the ownership of goods When we check the physical inventory for the purpose of checking that it is per records or to check the loss due to wastage, theft, loss of inventory and check the reasons for the same.   Answer 19-C. Accounts Receivcable is debited if eventual collection is expected. When the note is dishonoured and we expected it will be collected in the future, if passed the journal entry: Accounts Receivable                               Dr. XXX    To Notes Receivable XXX Answer 20-A. Cash Sales The sales through Visa and Master Card sales are onsiders as cash sales, as these credit card companies paid the retailers in behald of customers.

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