B3 part 1 only

Question B3 Part 1 Below is the information for Frizzle Company on 30 September 2019: (1) The cash ledger account showed a balance of $2,559, while the bank statement indicated a balance of $5,728 (2) The bank returned a customer's NSF check for $689 that the Company previously received as settlement of an account receivable. (3) ZYX company settled its notes payable by depositing $8,000 for the principal and $58 dollars for the interest, directly into Frizzle's bank account (4) A $800 check mailed to the bank for deposit had not reached the bank on 30 September (5) The accounting records showed that check written by Frizzle in September amounted to $130,000, but only $128,500 of them was found in the bank statement. (6) A $2,000 cash purchase of inventory on 23 September was mistakenly recorded as cash sale in the book. The company adopts periodic inventory system. (7) A $1,200 check received from Frizzle's customer for service revenue was erroneously recorded as $2,100 in the book. (8) No outstanding checks were carried over from August and no deposits in transits were noted at the end of August Required: a) Prepare the bank reconciliation for the month of September 2019. (4 marks) b) Prepare the necessary journal entries to update the accounting records. (4 marks) Part II Faber Company adjusts and closes its accounts annually on 31 December. It uses the allowance method to write off uncollectible accounts receivable. The following information was extracted from its unadjusted trial balance dated 31 December 2019: Debit S 300,000 Credit S Accounts receivable Allowance for impairment Sales revenue (80% on credit) Credit sales return 3,800 1,000,000 40,000 Page 7 of 10