Answer to Question #270565 in Accounting for Wae

Question

QUESTIONS:

Identify whether the following independent transaction is a book or a bank reconciling. In addition, determine the amount of the error and state whether the amount will be added or deducted in the preparation of the bank reconciliation (use adjusted method):

1. Eagle Repairs received P1,500 from Jane. The bookkeeper recorded the amount as P500.

The bank teller deducted CK 123 for P3,500 from the account of Eagle. The said check was issued by Egles Company a different

4. The bookkeeper of Eagle recorded Check No. 345 in the Cash Disbursement Journal as P5,205. The correct amount of the check

5. The deposits of Eagle earned interest of P100 for the month. Eagle does not have knowledge of interest earned until it receives

the bank statement.

Answer:

2. Nation Bank collected from the customer of Eagle the sum of P5,000 representing payment of the said customer to Eagle. No entry

was made in the books of Eagle.

Answer: 3.

depositor of the bank.

Answer:

was P5,250.

Answer:

Answer:

Answer 1

Solution:

1.). The transaction is a book reconciling item since the cash account was understated by 1,000. The amount of the error is P1,000. The amount will be added to the cash book balance in the preparation of the bank reconciliation.

 

2.). This is a book reconciling item since no entry was posted in the cash account. The amount of the error is P5,000. The amount will be added to the cash book balance in the preparation for the bank reconciliation.

 

3.). The transaction is a bank reconciling item. The amount in error is P3,500. The amount will be added to the bank balance in the preparation for the bank reconciliation.

 

4.). The transaction is a book reconciling item since the cash account was overstated by P45. The amount of the error is P45. The amount will be deducted from the cash book balance in the preparation of the bank reconciliation.

 

5.). The transaction is a book reconciling item since the interest amount was not omitted from the cash book. The amount in error is P100. The amount will be added to the cash book balance in the preparation of the bank reconciliation.