23-18 (OBJECTIVE 23-3) The Cairo Wheat Supply Company, a client of yours, informs you that they recently lost several employees in their accounting department. They are strug- gling to prepare for their yearly audit, so they have asked you to assist with their bank reconciliation for the year ended December 31, 2010. You obtain the following financial information from the company: General Ledger Bank Statement Beginning balance 12/1/10 $ 8,178 $ 10,123 Deposits 30,012 Cash receipts journal 32,156 Checks cleared (17.456) Cash disbursements journal (18,478) July bank service charge Note paid directly (20,500) NSF check (125) Ending balance 12/31/10 $ 21,856 $ 20.024 (30) November 30 Bank Reconciliation Information in General Ledger and Bank Statement Balance per bank $10,123 Deposits in transit 1.300 Outstanding checks (3.245) Balance per books $8,178 You also obtain some additional information, as follows: 1 Checks clearing that were outstanding as of November 30 totaled $3.000 2. Checks clearing that were recorded in the December disbure $13,935. 3. A check for $500 just cleared the bank but has not yet be disbursements journal. You learn that the expe recently purchased by the company. 4. In December, a check for $405 was mistakenly charged to Cai was actually intended for a different company's bank account. The to credit Cairo Wheat Supply for the difference. 5. Deposits in December consist of $1,300 from November an ded in the December disbursements journal totaled ared the bank but has not yet been recorded in the cash nal. You learn that the expense is for several bushels of wheat mistakenly charged to Cairo Wheat Supply, but any's bank account. The bank has agreed 300 from November and $28,712 from December. ALL THE ALINIT PROCESS TO OTHER CYCLES 6. Cairo Wheat Company signed a temporary loan agreement with the bank earlier in the year, a payment for which is due in December in the amount of $2,500. This amount has not yet been recorded on the books. 1. An expected payment from a customer in the amount of $125 did not clear the bank. The credit manager investigated the matter and discovered that the account was closed after its owner died. The amount is not expected to be paid from the estate. a. Prepare a bank reconciliation that shows both the unadjusted and adjusted balance per books. b. Prepare all adjusting entries. What audit procedures would you use to verify each item in the bank reconciliation? what is the cash balance that should appear on the December 31, 2010, financial statements