6 3 At December 31, 2016 the Cash account in the Tyler Company's general ledger had a debit balance of $18, M3.27 4 The December 31, 2016 bank statement showed a blance of $19,726.40. In reconciling the tow amounts you discovered the following: 5 Bank deposits made by Tyler on December 31 amounting to $2,145.40 do not appear on the bank statement 2 A non interest bearing note receivable from the Smith Company of $2,000 left with the bank for collection was collected by the bank at the end of December 7 The bank credited the proceeds, less as collection charge on the bank statement. Tyler Company has not recorded the collection 8 3 Accompanying the bank statement is a debit memorandum indicating that John Miller's check for Saso was charged against Tyler's bank account on December 30 because of insufficient funds 4 Chech No 586 written for advertising expense of $69.10 was recorded as $16.10 by Tyler Company 10 SA comparison of the paid checks returned by the bank with the recorded disbursements revealed that the following checks are still outstanding as of December 31 11 Chk Amount 9 S884764 The mistakenly charged Tyler Company's account for check printing costs of $30.5 which should have been changed to Taylor Company The hank charged tyder Company's account $.42 50 for the rental of a safe deposit box, box. No entry has been made by Tyler's records for this expense 207 23 Required 24. Prepare a bank reconciliation as of December 31, 2016 25 b Prepare any necessary journal entries at December 31, 2016 Tyler Company Bank Reconciliation 31-Dec-16 Ending Balance from bank statement Add: Deposits in Transit Error by bank (check printing Total Less: Outstanding Checks Balance from General Ledger Add: Add: Collection of note Less: Collection Charge Error by bank (check printing Total Less: Reconcilied Cash Book Balance Total Outstanding Checks Reconciled Cash Bank Balance Identity with internal control concept is being violated and explain how this may cause an apportunity for fraud to occur 1 The Supervisor for the purchasing department has to taken a vaction in three years Answer 2 Inventory is left in a receiving area at the back of the store by an open door Answer 3 The purchasing supervisor has the authority to order a pruchase and also to receive the merchandise, record its receipt and authorize the accounting dept to issure a check Answer 72 Match the Internal control function from the left hand column with the area of responsibility in the right hand column Answer Left Hand Right Hand Prepares Deposit receipts Treasurer's Dept Approves unusual transactions Retail Sales Supervisor Prepares remittance list Mail room Prepares bank reconcilitation Internal Audit Dept Compares deposit receipt to remittance list Controller's Dept 7.3 Match the reconciling items from the left hand column with the proper reconciling action from the right hand column Answer Left Hand Right Hand Deposits in transit Add to bank statement balance Outstanding checks Subtract from bank statement balance b Bank service charge Subtract from cash general ledger account Cash collected by bank on note Add to cash general ledger account d