The March bank statement showed the following for Yap Co.: Additional information: 1. The bank statement contained

Question:

The March bank statement showed the following for Yap Co.:

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Additional information:

1. The bank statement contained three debit memoranda:

? An NSF cheque of $595 that Yap had deposited was returned due to insufficient funds in the maker?s bank account. This cheque was originally given to Yap by Mr. Jordan, a customer, in payment of his account. Yap believes it will be able to collect this amount from Mr. Jordan.

? A bank loan payment (LN), which included $125 of interest and a $1,000 payment on the principal. Use Notes Payable.

? A service charge (SC) of $49 for bank services provided throughout the month.

2. The bank statement contained one credit memorandum for $23 of interest (IN) earned on the account for the month.

3. The bank made an error processing cheque #3478. No other errors were made by the bank.

Yap?s unadjusted cash balance per its general ledger on March 31 is $8,495. Yap?s list of cash receipts and cash payments showed the following for March:

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Instructions

a. Prepare a bank reconciliation at March 31.

b. Prepare the necessary adjusting entries at March 31. The correction of any errors in the recording of cheques should be made to Accounts Payable. The correction of any errors in the recording of cash receipts should be made to Accounts Receivable.

The company will prepare entries to record items found in the above bank reconciliation (see part [b] in the instructions). Describe any other follow-up actions required regarding the other reconciling items in Yap Co.?s bank reconciliation.

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Related Book For  book-img-for-question

Accounting Principles Volume 1

ISBN: 978-1119502425

8th Canadian Edition

Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak

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