BA 220 Week 5 Homework Latest Grantham
- What is the importance of the turnover of accounts receivables?
- Why is it is essential for organizations to keep cash reserves on hands?
- Is it possible to still bring in a lot of revenue, but still be short on cash?
- How can this happen or not happen?
Problem 6-7 A
Han’s Supplies’ bank statement contained a $270 NSF check that one of its customers had written to pay for supplies purchased.
- Show the effects of recognizing the NSF check on the financial statements by recording the
- appropriate amounts in a horizontal statements model like the following one:
Assets = Liab. + Equity
- Cash + Accts. Rec. Rev - Exp. = Net. Inc Cash Flow b. Is the recognition of the NSF check on Han’s books an asset source, use, or exchange transaction?
- Suppose the customer redeems the check by giving Han $290 cash in exchange for the bad
check. The additional $20 paid a service fee charged by Han. Show the effects on the
- financial statements in the horizontal statements model in Requirement a.
- Is the receipt of cash referenced in Requirement c an asset source, use, or exchange transaction?
- Record in general journal form the adjusting entry for the NSF check and the entry for
- redemption of the check by the customer.
Problem 6-10 A
As of June 30, 2016, the bank statement showed an ending balance of $19,500. The unadjusted
Cash account balance was $15,200. The following information is available:
- Deposit in transit, $2,400.
- Credit memo in bank statement for interest earned in June, $30.
- Outstanding check, $6,690.
- Debit memo for service charge, $20.
- Determine the true cash balance by preparing a bank reconciliation as of June 30, 2016, using
- the preceding information.
- Record in general journal format the adjusting entries necessary to correct the unadjusted
- book balance.
Problem 6-11 A
The following information is available for Trinkle Company for the month of June:
- The unadjusted balance per the bank statement on June 30 was $81,500.
- Deposits in transit on June 30 were $3,150.
- A debit memo was included with the bank statement for a service charge of $40.
- A $5,611 check written in June had not been paid by the bank.
- The bank statement included a $950 credit memo for the collection of a note. The principal of the note was $900, and the interest collected amounted to $50.
Determine the true cash balance as of June 30, (Hint: It is not necessary to use all of the
preceding items to determine the true balance.)