Cash and Cash Controls

Cash includes coins, paper currency, checks, money orders, and money deposited with a financial institution that the company can withdraw at any time. The key to classification of an amount as cash is that it be readily available to pay debts. Cash is a current asset reported on the Balance Sheet . Cash also includes items properly classified as cash equivalents. These are limited to investments that are readily convertible to known amounts of cash and have an original maturity to the investor of three months or less.

Bank Reconciliation

A bank reconciliation explains the causes for any differences between a company's cash balance on its bank statement and its cash balance on the books (that is, in the ledger. )

Allez Company's monthly bank statement shows an account balance of $5679.48. The cash balance in its ledger is $4962.47.

A thorough bank reconciliation investigation yields the following information:

The bank erroneously deducted $344.84 from the company's account when the actual amount of a check written by the company was $324.84.

The company erroneously recorded a check it wrote for $349.24 as $481.63.

The company recently made a $693.94 deposit that has not yet been reflected on the bank statement.

The bank collected a $540.00 note receivable, plus $15.00 in interest, which has not been recorded in the company's records.

Bank service charges of $17.00 have been assessed to the company's account.

There are two checks outstanding (not yet appearing on the bank statement) that were written for $752.49 and $425.23.

A $417.16 check from one of the company's customers, Phil Conners, was returned by the bank because of insufficient funds (NSF) in the customer's account.

Prepare the bank reconciliation for Allez Co. Enter amounts to the nearest cent.

Allez Co.
Bank Reconciliation
January 31, 2014
Cash balance per bank statement		$fill in the blank 2c3cceffffb901d_1
Deduct: Deposit not recorded by bank (deposit in transit)	$fill in the blank 2c3cceffffb901d_3
Deduct: Bank error in charging check	fill in the blank 2c3cceffffb901d_5	fill in the blank 2c3cceffffb901d_6
		$fill in the blank 2c3cceffffb901d_7
Add: Outstanding checks		fill in the blank 2c3cceffffb901d_9
Adjusted balance		$fill in the blank 2c3cceffffb901d_10
Cash balance per company records		$fill in the blank 2c3cceffffb901d_11
	$fill in the blank 2c3cceffffb901d_13
	fill in the blank 2c3cceffffb901d_15	fill in the blank 2c3cceffffb901d_16
		$fill in the blank 2c3cceffffb901d_17
	$fill in the blank 2c3cceffffb901d_19
	fill in the blank 2c3cceffffb901d_21	fill in the blank 2c3cceffffb901d_22
Adjusted balance		$fill in the blank 2c3cceffffb901d_23

Cash management and Control

Effective cash management and control over cash includes which of the following?

1.	Delaying payment of liabilities as long as possible
2.	Speeding up collection of receivables
3.	Investing idle cash to earn the greatest possible return while still being able to meet cash needs
4.	With the exception of a petty cash fund, making all disbursements by check.
5.	Paying suppliers earlier than payment terms require
6.	Preparing bank reconciliations
7.	Purchasing excess inventory with excess cash
8.	Deploying procedures to safeguard cash
9.	Depositing cash receipts when the amount reaches a predetermined level
10.	Use of petty cash funds for minor disbursements
11.	Approving suppliers before purchasing from them
12.	Segregating cash duties