Problem 1:
The following data were given to you for the preparation of the three date Proof of Cash of Naku Po Corporation:
November 30 December 31 January 12
Naku Po Corporation
2017 2017 2018
Bank Statement Balance 27,324.08 20,383.89 29,514.84
Book Balance 21,214.95 16,689.86
Outstanding Checks 7,324.13 8,231.12 3,172.50
Deposit in Transit 2,200.00 3,750.00 1,625.00
Dec. 1 – 31 Jan. 1 – 12
2017 2018
Book Receipts 88,546.50 21,473.26
Bank Credits 86,324.00 24,372.10
Book Disbursement 93,071.59 9,980.03
Bank Charges 93,264.19 15,241.15
The company obtained the bank statement for November and December 2017, and reconciled the balances. You also obtained directly the bank statement for January 12, 2018
and obtained necessary confirmations. You have found that there are no errors in addition or subtraction in the client’s books. The following information also was obtained:
1. Bank service charges of P11.50 were charged on the November 30, 2017 statement and recorded in the cash disbursement book on December 5, 2017; statement bank
service charge December P13.25 and recorded in the cash disbursements on January 6, 2018.
2. Check No. 3132289 for P22.48 cleared the bank in December as P122.48. This was found in proving the bank statement. The bank made the correction on January 8, 2018.
3. A note of P1,000, sent to the bank for collection on November 15, 2017 was collected and credited to the account on November 28, 2017, net of collection fee of P3.50. The
note was recorded in the cash receipts on December 21, 2017, at which date the collection fee was entered as disbursement.
4. The client records returned checks in red in the cash receipts books. The following checks were returned by the bank:
Customer Amount Date Returned Date Recorded Date Redeposited
Garcia, Pining P327.50 Dec. 6, 2017 ---* Dec. 8, 2017
Cool, Gina 673.84 Dec. 27, 2017 ---* Jan. 12, 2018
---* no entries for this item were made in the receipts or the disbursement records
5. Two payroll checks for employees vacation totaling P215.75 were drawn on January 3, 2018, and cleared the bank on January 8, 2018. These two checks were not entered in
the client’s records because semimonthly payroll summaries (from the payroll records) are entered in the disbursement only on the fifteenth and thirtieth or thirty-first of
each month.
Problem 2:
In connection with the preparation of proof of cash of DBEST Company as of June 30, 2018, the following among others, were obtained pertaining to the verification of Cash:
a. Entries in the books and bank statement were summarized as follows:
Books Bank
Balance, May 31 69,200 75,000
Add Cash Receipts 202,500 297,400
Total 271,700 372,400
Less Cash Disbursement 235,200 228,000
Balance 36,500 144,400
b. Undeposited collections, per records kept by the accountant, on May 31, and June 30, amounted to P3,400 and P6,000, respectively.
c. Deposit column of the bank statement showed the following which could not be traced to the books:
1. Proceeds of a bank loan credited on June 16 at discounted amount of P88,000 at 12% for one year.
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2. Proceeds from sale of shares of stock amounting to P10,000 (cost P8,000) transmitted directly by stock broker to the bank and credited on June 29.
3. Check of P500 received from a salesman, who liquidated his advance, and deposited on June 2 was subsequently charged (under Deposit column) by the bank on
June 28 due to “no arrangements”.
d. Checks outstanding, per records kept by the accountant, as of May 31, and June 30, were as follows:
May 31 June 30
No. No.
842 2,500 915 5,500
843 4,200 916 2,500
844 2,000 917 3,000
845 500 918 1,000
e. Included among charges in June 2018 bank statement were the following:
1. Check of DBEAST Company for P1,600, which was charged in error by bank.
2. Check No. 830 for P1,000, dated May 27, 2018 and paid to “Cash”. This was ascertained to have been properly recorded in May 2018
3. Check No. 844 for P200, dated May 31, 2018, and issued to trade creditor. It was verified that this disbursement was recorded erroneously in the books at P2,000.
4. Check No. 870 for P4,200, dated June 10, 2018. This was issued to replace Check No. 843, which was accidentally destroyed by the payee, a trade creditor. While a
stop payment order was issued to the bank on June 5, 2018, when advice was received from payee no entry has been made in the books to record cancellation of
No. 843.
f. Footing of June 2018 cash receipts of P202,500 and cash disbursement of P235,200 should be P203,500 and 234,200 respectively.
g. It was found from the confirmation replies received that the balance of P1,000 due from customer as of June 30, 2018 was paid on June 18,2018. However, this could not be
traced to the cash receipts book and deposit made in June 2018.
Problem 3: On December 31, 2019, the cash count of Pateros Company has a debit balance of P2,375,000. An analysis of the cash account
shows the following details:
Cash in bank – ABC Bank checking account 250,000
Cash in bank – XYZ Bank (overdraft) (25,000)
Cash in bank – ABC Bank (payroll fund) 75,000
Cash in bank – ABC Bank (saving deposit) 50,000
Cash in bank – ABC Bank (money market instrument, 90 days) 1,000,000
Cash in foreign bank (restricted) 500,000
Undeposited collections 30,000
Undeposited NSF check received from customer, dated December 1, 2019 7,500
Undeposited check from customer, dated January 15, 2020 12,500
IOUs from officers 15,000
Listed shares held as trading investment 60,000
Sinking fund cash 225,000
Sinking Fund Securities acquired on Dec 1, 2019, with a maturity date on Feb 1, 2020 175,000
Compute for the cash and cash equivalent that should be shown in the statement of financial position.
Problem 4: The following information were taken from the books of Survivor Corporation:
a) Balances of cash account per the general ledger at Nov. 30, and December 31, were: P38,020.00 and P9,770.00
respectively.
b) Balance of demand deposits at the National Bank at December 31, per bank confirmation was P10,000.00.
c) Outstanding checks at Dec. 31 amounted to P4,000.00.
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d) An N.S.F. check for P245.00 was charged by the bank in December. This check was obtained from a customer on
account.
e) Deposits in transit at the beginning and end of month were P2,500 and P3,500, respectively.
f) Exchange and collection charges deducted by the bank in the amount of P25.00 for Dec. have not been recorded.
Those charges for the month of November totaled P20.00.
g) The reconciliation data as of Nov. 30 showed that the balance per bank statement was
P45,000.00 and the outstanding checks totaled P10,000.00.
h) In Nov., the bank charged in error a P260.00 check to the Jackson Co., account. It was corrected by the bank in
December.
i) Total deposits shown by the bank statement for December amounted to P100,000.00.
j) Following is a summary of cash receipts and disbursement for the month indicated.
November December
Receipts.......... P102,470 P100,740
Disbursements 129,880 128,990
(1) The adjusted bank disbursement for December would include a net adjustment of _____.
(2) The Cash in bank balance for December would be?
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