Focus on Financials

Canadian Tire Corporation

Refer to Canadian Tires financial statements in Appendix A at the end of the book. Suppose Canadian Tires bank statement has just arrived at company headquarters. Further assume the bank statement shows Canadian Tires cash balance and also assume that cash and cash equivalents has a balance on the books.

1. You must determine how much to report for cash and cash equivalents on the January 3, 2015 balance sheet. Suppose you uncover these reconciling items (all amounts in millions):

a. Interest earned on bank balance,

b. Outstanding cheques

c. Deposits in transit,

d. Transposition error

e. Bank charges

Prepare a bank reconciliation.

2. How much were Canadian Tires receivables What can you assume from this information?

3. How much did Canadian Tire collect from customers during 2014?