Spring Company, Inc. had the following cash accounts at UnHappy State Bank:One account is restricted solely for the construction of a new plantin three years.• A second account is overdrawn by $18,000.The third account has a positive balance of $8,000●●How should these accounts be reported in Spring's balance sheet?(CPA)O The restricted and regular accounts should be reported as current assets, andthe overdraft should be reported as a current liabilityO The restricted account should be reported as a noncurrent asset, theoverdraft should be reported as a current liability, and the regular accountshould be reported as a current assetO The restricted account and the regular account should be reported as acurient asset net of the overdraftO The restricted account should be reported as a noncurrent asset, and theregular account should be reported as a current asset net of the overdraft

The objective of the question is to determine how the different cash accounts of Spring Company,…

Answered: Spring Company, Inc. had the following…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter5: Internal Control And Cash

Section: Chapter Questions

Problem 2SEQ

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On March 2, 2022, Jenny received its bank statement of the month ending February 28. The statement showed a P209,500 balance while the cash account balance on February 28 was P35,000. In reconciling the balances, the following were noticed: a. The February 28 collections of P176,000 were recorded on the books but were not deposited until March. b. The bank service charges for the month of February totaled P3,000. c. A paid check for P24,300 was entered incorrectly in the cash payments journal as P34,200. What is the total outstanding checks at February 28, 2022?
Joey Co just completed it's bank reconciliation for the year-ended December 31, 20x1. The following adjustments were used as part of the bank reconciliation: Outstanding cheques Bank service charges $2,100 300 Non-sufficient fund cheques from customers removed from bank account 200 Deposits in transit 1,700 A cheque from a customer was incorrectly recorded as $500 when it should have been recorded as $2,500. What is the total adjustment required to cash in the general ledger?
Safari Company has a balance of P100,000 in cash & cash equivalents account as of December 31, 2022. The following items were found to be included in this balance. a. Compensating balance of P5,000 which is legally restricted as to withdrawal b. A negative bank balance of P10,000 from one of its bank accounts from just one bank. c. Plant expansion fund of P25,000 which is expected to be used on January 3, 2023. d. A certified check received from one customer last March 24, 2022. How much is the cash and cash equivalents to be presented in the 2022 Financial Statements?
Maria Clara Company has a balance of P100,000 in cash & cash equivalents account as of December 31, 2023. The following items were found to be included in this balance. a. Compensating balance of P5,000 which is legally restricted as to withdrawal b. A negative bank balance of P10,000 from one of its bank accounts from just one bank. c. Plant expansion fund of P25,000 which is expected to be used on January 3, 2024. d. A certified check received from one customer last March 24, 2023. How much is the cash and cash equivalents to be presented in the 2023 Financial Statements?
The controller for Pharoah Company is trying to determine the amount of cash to report on the December 31, 2020 statement of financial position. The following information is provided: 1. A commercial savings account with $660,000 and a commercial chequing account balance of $880,000 are held at First National Bank. There is also a bank overdraft of $37,000 in a chequing account at the Royal Scotia Bank. No other accounts are held at the Royal Scotia Bank. 2. Pharoah has agreed to maintain a cash balance of $93,000 at all times in its chequing account at First National Bank to ensure that credit is available in the future. 3. Pharoah has a $6-million investment in a Commercial Bank of Montreal money-market mutual fund. This fund has chequing account privileges. 4. There are travel advances of $25,000 for executive travel for the first quarter of next year. (Employees will complete expense reports after they travel.) 5. A separate cash fund in the amount of $1.0…
Burr Company had the following account balances at December 31, 1998: Cash in bank Cash on hand Cash legally restricted for additions to plant (expected to be disbursed in 1999) 2,250,000 125,000 1,600,000 Cash in bank includes P600,000 of compensating balance against short-term borrowing arrangement. The compensating balance s-not legally restricted as to withdrawal by Burr. In the current assets section of Burr's December 31, 1998 balance sheet, total cash should be reported at
Tallent Corporation had the following account balances at December 31, Year 1: Cash on hand and in banks $975,000 Cash legally restricted for additions to plant (expected to be disbursed in Year 3) 600,000 Bank certificates of deposit (due February 1, Year 2, purchased September 1, Year 1) 250,000 In the current assets section of Tallent’s December 31, Year 1, balance sheet, what total amount should be reported under the caption "cash and cash equivalents"?
The cash account shows a balance of P45,000 before reconciliation. The bank statement does not include a deposit of P2,300 made on the last day of the month. The bank statement shows a collection by the bank of P940 and a customer's check for P320 was returned because it was NSF. A customer's check for P450 was recorded on the books as P540, and a check written for P79 was recorded as P97. The correct balance in the cash account was
I need help with the final step. It says i have everything else correct but im at a loss for the final step On August 31, 2019, the balance in the checkbook and the Cash account of the Dry Creek Bed and Breakfast was $12,316. The balance shown on the bank statement on the same date was $13,217. Notes The firm’s records indicate that a $1,490 deposit dated August 30 and a $705 deposit dated August 31 do not appear on the bank statement. A service charge of $7 and a debit memorandum of $340 covering an NSF check have not yet been entered in the firm’s records. (The check was issued by Art Corts, a credit customer.) The following checks were issued but have not yet been paid by the bank: Check 712, $ 114 Check 713, $ 129 Check 716, $ 242 Check 736, $ 581 Check 739, $ 82 Check 741, $ 124 A credit memorandum shows that the bank collected a $2,104 note receivable and interest of $67 for the firm. These amounts have not yet been entered in the…
A company’s draft financial statements for 2021 showed a profit of $630,000. However, the trial balance did not agree, and a suspense account appeared in the company’s financial statements.Subsequent checking revealed the following errors:1 The cost of an item of plant $48,000 had been entered in the cash book and in the plant account as $4,800.2 Bank charges of $440 appeared in the bank statement in December 2021 but had not been entered in the company’s records.3 One of the directors paid $800 due to a supplier in the company’s payables ledger by a personal cheque. The bookkeeper recorded a debit in the supplier’s ledger account but did not complete the double entry for the transaction.4 The payments side of the cash book had been understated by $10,000. Which of the above items would require an entry to the suspense account in correcting them? What would the company’s profit become after the correction of the above errors?
On October 31, 2020, a company had cash accounts at three different banks. One account balance is segregated solely for a November 15, 2020 payment into a bond sinking fund. A second account, used for branch operations, is overdrawn. The third account, used for regular corporate operations, has a positive balance. How should these accounts be reported in the October 31, 2020 Statement of Financial Position? The segregated and regular accounts should be reported as current assets, and the overdraft should be reported as a current liability. O The segregated account should be reported as a noncurrent asset, the regular account should be reported as a current asset, and the overdraft should be reported as current liability. The segregated and the regular accounts should be reported as current assets net of the overdraft. O The segregated account should be reported as a noncurrent asset, and the regular account should be reported as a current asset net of the overdrafts.
T. Howard's Cash Book at 2020 September 30 showed debit balance at the bank of $1 024 but the Bank Statement at same date had a credit balance of $262.After comparing the Cash Book with the Bank Statement, the following differences were noted: i. An amount of $142 paid into the bank had not yet appeared on the Statement.ii. Bank interest of $60 in respect of an earlier overdraft had been charged by the bank. iii. Cheques issued for $560 had not been presented for payment.iv. A cheque received for $800 and debited in the Cash Book was returned unpaid by the bank because of lack of funds. v. Funds of $1 120 paid into the bank had been entered in the Cash Book as $1 000.vi. The bank had made a standing order payment for insurance of $480 which had not been recorded in the Cash Book.vii. The bank had received by direct credit transfer a payment of $40 due to Howard from G. Keith. Prepare the following:A. Updated Cash Book of T. Howard.B. Bank Reconciliation Statement as at 2021 September…

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