Answered step by step
Verified Expert Solution
Question
1 Approved Answer
gst is 15^ On 30 June 2018, Scott Ltd's general ledger showed Cash with a normal balance of $13,004.30. The bank statement, just received from
gst is 15^
On 30 June 2018, Scott Ltd's general ledger showed Cash with a normal balance of $13,004.30. The bank statement, just received from BNZ, showed a balance of $18,915.00. Scott Ltd is a retailer of artificial eyelashes. A comparison of the statement with the accounting records and the bank reconciliation for May revealed the following facts o Two cheques, totalling $1,770.10, from the May bank reconciliation were still outstanding ii) On 20 June, Scott Ltd deposited $2,945 in the bank but Scott Ltd's journal entry recorded both the DR and the CR as $2,954. The entire amount related to cash sales of merchandise ii)June outstanding cheques totalled $3,567.10 and June deposits in transit were $1,770.40 (ii) On 24 June, Scott Ltd issued cheque no. 3485 for $540.80 to Tee Lee, in payment for a credit purchase of inventory. Lee does not offer sales discounts. The bank statement showed the correct amount, but the journal entry recorded both the DR and the CR as $450.80 v) The bank statement showed that a customer had electronically deposited $3,060 in payment of a $3,000 note receivable. The deposit included interest of $80, less the bank's wire transfer fee of $20. Scott Ltd had accrued interest of $45 on 31 May, the end of the previous accounting period )The bank statement showed a debit entry for $647.10 for a dishonoured (NSF) cheque written by N. Brown, a customer, to Scott Ltd This cheque will not be re-deposited because Brown is expected to make an internet transfer to Scott Ltd in July. The bank statement also showed a debit entry for $580 for another NSF cheque. The bank had sent this cheque back to Scott Ltd on June 28, but Scott Ltd, expecting the cheque to clear this time around, re-deposited the cheque on June 30. The $580 thus is included in the deposit in transit fiqure mentioned in (iii) above (vi) The bank statement showed a debit entry for $647.10 for a dishonoured (NSF) cheque written by N. Brown, a customer, to Scott Ltd. This cheque will not be re-deposited because Brown is expected to make an internet transfer to Scott Ltd in July. The bank statement also showed a debit entry for $580 for another NSF cheque. The bank had sent this cheque back to Scott Ltd on June 28, but Scott Ltd, expecting the cheque to clear this time around, re-deposited the cheque on June 30. The $580 thus is included in the deposit in transit figure mentioned in (ii) above. (vii) The bank statement also showed a debit entry for a $15 service fee charge and a credit entry for interest earned of $45. Required: a) Prior to preparing the bank reconciliation for June, please prepare the necessary journal entries suggested by the bank reconciliation process. Ignore GST. b) Prepare the bank reconciliation for Scott Ltd as at 30 June 2018. You may assume that the journal entries from a) have been posted and the accounts updated. You do not have to show the GL for this requirement Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started