a) The following bank statement was received. Prepare a bank reconciliation for May:
b) Prepare the appropriate adjusting entries on May 31, 2015. Hint: Some additional information is provided below but where else might you look to find details relevant to preparing the adjusting entries?
- It is estimated that utilities used during May totalled $25,315.
- Actual count of ending merchandise inventory on May 31, 2015 was $2,152,117.
- Management estimates uncollectible accounts receivable based on the following rates of uncollectibility applied to outstanding accounts: Not yet due (2%), 1-30 days past due (9%), 31-60 days past due (18%), Greater than 61 days past due (60%). Since this is an estimate please round your final answer to the nearest whole dollar.
- Income taxes are estimated to be $259,400.
Bank Statement To: Weber Inc. May 31, 2015 Cheques/Charges/Debits Deposits/Credits Balance 1,493,827 #1677 01/May 5,800 01/May 684,000 2,172,027 NSF Cheque 03/May 32,166 2,139,861 #1678 07/May 819,000 07/May 387,296 1,708,157 #1679 15/May 46,000 15/May 1,755 1,663,912 18/May 35,750 1,699,662 #1682 23/May 553,000 1,146,662 24/May 1,528,800 2,675,462 #1683 26/May 867,790 1,807,672 #1684 29/May 30,500 1,777,172 #1685 31/May 46,000 1,731,172 Service Charge 31/May 1,300 1,729,872 Additional Information: The NSF cheque was received in April from Holden Corp. for a sale dated April 15. Weber Inc. Bank Reconciliation May 31, 2015 1,729,872 Book balance... Add: 32,166 + - Bank statement balance... Add: + NSF cheque Deduct: Deduct: + - Outstanding cheques: + -1 Adjusted bank balance Adjusted book balance General Journal Account/Explanation Page Gj1 F Debit Credit General Journal Account/Explanation Page GJ2 F Debit Credit Date Date + + 1 +1 -1 + - + - + -1 + -1 +1 -1 + -1 c) What is the next step in the accounting cycle? O Prepare an unadjusted trial balance O Prepare closing entries o Post closing entries O Post transactions This is the last step O Prepare financial statements o Prepare a post-closing trial balance O Prepare an adjusted trial balance O Analyze and journalize transactions O Post adjusting entries Bank Statement To: Weber Inc. May 31, 2015 Cheques/Charges/Debits Deposits/Credits Balance 1,493,827 #1677 01/May 5,800 01/May 684,000 2,172,027 NSF Cheque 03/May 32,166 2,139,861 #1678 07/May 819,000 07/May 387,296 1,708,157 #1679 15/May 46,000 15/May 1,755 1,663,912 18/May 35,750 1,699,662 #1682 23/May 553,000 1,146,662 24/May 1,528,800 2,675,462 #1683 26/May 867,790 1,807,672 #1684 29/May 30,500 1,777,172 #1685 31/May 46,000 1,731,172 Service Charge 31/May 1,300 1,729,872 Additional Information: The NSF cheque was received in April from Holden Corp. for a sale dated April 15. Weber Inc. Bank Reconciliation May 31, 2015 1,729,872 Book balance... Add: 32,166 + - Bank statement balance... Add: + NSF cheque Deduct: Deduct: + - Outstanding cheques: + -1 Adjusted bank balance Adjusted book balance General Journal Account/Explanation Page Gj1 F Debit Credit General Journal Account/Explanation Page GJ2 F Debit Credit Date Date + + 1 +1 -1 + - + - + -1 + -1 +1 -1 + -1 c) What is the next step in the accounting cycle? O Prepare an unadjusted trial balance O Prepare closing entries o Post closing entries O Post transactions This is the last step O Prepare financial statements o Prepare a post-closing trial balance O Prepare an adjusted trial balance O Analyze and journalize transactions O Post adjusting entries
