7 B Question 4 - Cash and Receivables (13 marks) **Please only enter your response in the blue cells. This is the only area that will be graded 2. 3 4 5 6 a) Bank Reconciliation (8 marks) Blackjack Corp. 's book balance of the cash account shows an unadjusted balance of $7.500 before reconciliation. The following data was also available: A customer's cheque for $650 was recorded on the books as $560. The bank statement does not include a deposit of $3.500 made on the last day of the month. The bank statement shows a collection of a note receivable by the bank of $1,250 and a customer's cheque for $60 was returned because it was NSF. 7 8 9 10 11 Required: 1. Calculate the correct balance in the cash account. (Note: you only need to do the book side of the bank rec.) (6 marks) 12 13 14 Item Amount 15 16 17 18 19 O 20 21 22 2. Prepare the journal entry needed to adjust the books for the returned NSF cheque in 1. above. (2 marks) 23 Debit Credit Date Account Titles 24 15 Month end 6 7 8 3 b) Accounts Receivable (5 marks) 1. Blues Corp. has a period end unadjusted trial balance that includes the following Dr Ci. 20 21 22 2. Prepare the journal entry needed to adjust the books for the returned NSF cheque in 1. above. (2 marks) 23 Date Account Titles Debit Credit 24 25 Month end 26 27 28 29 30 31 b) Accounts Receivable (5 marks) 32 33 1. Blues Corp. has a period end unadjusted trial balance that includes the following 34 Dr. Cr. 35 Accounts receivable 240,000 36 Allowance for doubtful accounts (AFDA) 1.980 37 Sales 425,000 9.000 38 Sales returns and allowances 39 0 Required: 1 Determine the period end adjusting journal entry necessary, when the estimate of uncollectible amounts 2 is based on 3% of gross receivables. (3 marks) 3 Debit Credit Account Titles 4 Date 5 31-Dec 6 4 7 8 9 0 1 B Extra workspace below (will not be graded): H20 A B 49 D E F 50 51 52 53 Extra workspace below (will not be graded): 54 55 56 57 58 59 60 61 2. When is the direct write-off method of accounting for the impartment of receivables acceptable? (2 marks) 62 63 64 65 66 67 68 69 FO 1 2