IFRs

Prepare a bank reconciliation and adjusting entries from detailed data. (LO 7) P7-4A The bank portion of the bank reconciliation for Rintala Ltd. at November 30, 2017, was as follows. RINTALA LTD. Bank Reconciliation November 30, 2017 Cash balance per bank Add: Deposits in transit 14,367.90 2,530.20 16,898.10 Less: Outstanding checks Check Number 3451 3470 3471 3472 3474 Adjusted cash balance per bank Check Amount 2,260.40 720.10 844.50 1,426.80 1,050.00 6,301.80 10,596.30 The adjusted cash balance per bank agreed with the cash balance per books at November 30. The December bank statement showed the following checks and deposits. Bank Statement 12-8 Date 12-1 12-2 12-7 12-4 12-8 12-10 12-15 12-27 12-30 12-29 12-31 Checks Number 3451 3471 3472 3475 3476 3477 3479 3480 3482 3483 3485 Total Amount 2,260.40 844.50 1,426.80 1,640.70 1,300.00 2,130.00 3,080.00 600.00 475.50 1,140.00 540.80 15,438.70 Deposits Date Amount 12-1 2,530.20 12-4 1,211.60 2,365.10 12-16 2,672.70 12-21 2,945.00 12-26 2,567.30 12-29 2,836.00 12-30 1,025.00 Total 18,152.90 The cash records per books for December showed the following. Cash Payments Journal Date Number Amount Date Number 12-1 3475 1,640.70 12-20 3482 12-2 3476 1,300.00 12-22 3483 12-2 2,130.00 12-23 3484 12-4 3478 621.30 12-24 3485 12-8 3479 3,080.00 12-30 3486 12-10 3480 600.00 Total 12-17 3481 807.40 3477 Amount 475.50 1,140.00 798.00 450.80 1,889.50 14,933.20 Cash Receipts Journal Date Amount 12-3 1,211.60 12-7 2,365.10 12-15 2,672.70 12-20 2,954.00 12-25 2,567.30 12-28 2,836.00 12-30 1,025.00 12-31 1,190.40 Total 16,822.10 The bank statement contained two memoranda: 1. A credit of 3,645 for the collection of a 3,500 note for Rintala plus interest of 160 and less a collection fee of 15. Rintala has not accrued any interest on the note. www.downloadslide.net Problems: Set A 371 2. A debit of 572.80 for an NSF check written by D. Chagnon, a customer. At December 31, the check had not been redeposited in the bank. At December 31, the cash balance per books was 12,485.20, and the cash balance per the bank statement was 20,154.30. The bank did not make any errors, but two errors were made by Rintala. Instructions (a) Using the four steps in the reconciliation procedure, prepare a bank reconciliation at December 31. (b) Prepare the adjusting entries based on the reconciliation. (Hint: The correction of any errors pertaining to recording checks should be made to Accounts Payable. The correction of any errors relating to recording cash receipts should be made to Accounts Receivable.) (a) Adjusted balance per books 15,458.40