It's all that I have
At Submi Check my work EverReady Corporation is in the home building and repair business. Construction business has been in a slump, and the company hat experienced financial difficulty over the past two years. Part of the problem lies in the company's desire to avoid laying off its skilled crews of bricklayers and cabinetmakers. Meeting the payroll has been a problem. The auditors are engaged to audit the 2017 financial statements. Knowing of EverReady's financial difficulty and its business policy the auditors decided to prepare a schedule of interbank transfers covering the 10 days before and after December 31, which is the company's balance sheet date. First, the auditors used the cash receipts and disbursements journals to prepare part of the schedule shown in Exhibit 6.52.1. They obtained the information for everything except the dates of deposit and payment in the bank statements (disbursing date per bank and receiving date per bank). The auditors learned that EverReady always transferred money to the payroll account at 1st National Bank from the general account at 1st National Bank. This transfer enabled the bank to clear the payroll checks without delay. The only bank accounts in the EverReady financial statements are the two at 1st National Bank Next, the auditors obtained the December 2017 and January 2018 bank statements for the general and payroll accounts at 1st National Bank. They recorded the bank disbursement and receipt dates in the schedule of interbank transfers. For each transfer, these dates are identical because the accounts are in the same bank. An alert auditor noticed that the 1st National Bank general account bank statement also contains deposits received from Citizen National Bank and canceled check 1799 dated January 5 payable to Citizen National Bank. This check cleared the 1st National Bank account on January 8 and was marked "transfer of funds. This led to the auditors' decision to inquire about this of EverReady's chief financial officer EXHIBIT 6.52.1 Schedule of Interbank Transfer EVERREADY CORPORATION Schedule of Interbank Transfers December 31, 2017 C-5 Prepared Date Reviewed Date Date per Disbursing Account Date per Amount Books 10,463 24-Dec Date per Bank 24-Dec Receiving Account Date per Bank Books 1st National Payroll 24-Dec Bank 24-Dec Bank 1st National Check 1417 Help Save & Exit Check EXHIBIT 6.52.1 Schedule of Interbank Transfers C-5 EVERREADY CORPORATION Schedule of Interbank Transfers December 31, 2017 Prepared Date Reviewed Date Date per Rank Check 1417 1601 1982 Bank 1st National 1st National 1st National Disbursing Account Date per Amount Books 10,463. 24-Dec 11,593. 31-Dec 9,971, 08-Jan Receiving Account Date per Bank Books 1st National Payroll 24-Dec/ 1st National Payroll 31-Dec 1st National Payroll 08-Jan 24-Dec 31-Dec 08-Jan- Date per Bank 24-Dec- 31-Dec 08-Jan Traced from cash disbursements journal Check properly listed as outstanding on bank reconciliation Vouched to check cleared in bank statement + Traced from cash receipts journal - Vouched deposit cleared in bank statement Note: We wamed the cash disbursements and cash receipts malforchete Asked about the Citizen National Bank transactions, EverReady's chief financial officer readily admitted the existence of an off- books bank account. He explained that it was used for financing transactions in keeping with normal practice in the construction industry. He gave the auditors the December and January bank statements for the account at Citizen National Bank. In it, the audite found the following: Check 4050 4051 4052 4053 4054 Citizen National Bank Payable to Amount Dated 1st National $10,000 23-Dec Chase Bank 12,000 28-Dec 1st National 12,000 30-Dec Chase Bank 14,000 4-Jan 1st National 20,000 20.000 8-Jan cleared Bank 29-Dec 31-Dec 05-Jan 07-Jan 13-Jan DULCD Flashcards. Search Textbook Solut.. 4.411 unread - inna Saved Help Save & Exits 4052 4053 4054 1st National Chase Bank 1st National Check my w 12,000 14,000 20,000 30-Dec 4-Jan 8-Jan 05-Jan 07-Jan 13-Jan Deposits Received from Amount Chase Bank $11,000 Chase Bank 15,000 1st National 10,000 Chase Bank 12,000 Date 22-Dec 30-Dec 05-Jan 07-Jan When asked about the Chase Bank transactions, EverReady's chief financial officer admitted the existence of another off-books bank account, which he said was the personal account of the principal stockholder. He explained that the stockholder often used it to finance EverReady's operations. He gave the auditors the December and January bank statements for this account at Chase Bank; in it, the auditors found the following: Payments check# 2220 2221 2222 Chase Bank Payable to Amount Citizen National Bank 11,000 Citizen National Bank 15,000 Citizen National Bank 12,000 Dated 22-Dec 30-Dec 7-Jan Cleared Bank 28-Dec 05-Jan 12-Jan Deposits Received from Citizen National Bank Citizen National Bank Amount 12,000 14,000 Dated 28-Dec 04-Jan Lille National Bank 12,000 7-Jan 03-Jan 12-Jan Deposits Received from Citizen National Bank Citizen National Bank Amount 12,000 14,000 Dated 28-Dec 04-Jan An abbreviated calendar for the period is in Exhibit 6.54.2. EXHIBIT 6.54.2 21 December 2017 January 2018 Required: WOL IS Correct or incorrect for the work you have completed so far. It does not indicate completion Return to question b. What is the actual cash balance for the three bank accounts combined, considering only the amounts given in this case information as of December 31, 2017 (before any of the December 31 payroll checks are cashed by employees)? As of January 8, 2018 (before any of the January 8 payroll checks are cashed by employees)? (Leave no cells blank - be certain to enter"0" wherever required. Negative amounts or amounts to be deducted should be indicated by a minus sign.) Answer is not complete. Check Chase Bank Bank(1) Actual(2) (11,000) 1st National Bank(1) Actual(2) 1st Nat'l Payroll Bank(1) Actual 2220 4050 Citizen National Bank Bank(1) Actual(2) 11,000 11,000 (10,000) 10,000 (10,463) 10,000 (10,463) 10,463 10,46 (10,463) (10.46: Date Dec 22 (Tue) Dec 23 (Wed) Dec 24 Thu). Payroll checks cashed Dec 28 (Mon) Dec 28 (Mon) Dec 29 (Tue) Dec 30 (Wed) Dec 30 (Wed) Dec 31 (Thu) 4051 (12,000) 12,000 (11,000) 2220 4050 (10,000) 15,000 2221 (15,000) 15,000 4052 (12,000) 12,000 (11,593) 12,000 (11,593) 11,503 11,59 1601 MacBook At Submi Check my work EverReady Corporation is in the home building and repair business. Construction business has been in a slump, and the company hat experienced financial difficulty over the past two years. Part of the problem lies in the company's desire to avoid laying off its skilled crews of bricklayers and cabinetmakers. Meeting the payroll has been a problem. The auditors are engaged to audit the 2017 financial statements. Knowing of EverReady's financial difficulty and its business policy the auditors decided to prepare a schedule of interbank transfers covering the 10 days before and after December 31, which is the company's balance sheet date. First, the auditors used the cash receipts and disbursements journals to prepare part of the schedule shown in Exhibit 6.52.1. They obtained the information for everything except the dates of deposit and payment in the bank statements (disbursing date per bank and receiving date per bank). The auditors learned that EverReady always transferred money to the payroll account at 1st National Bank from the general account at 1st National Bank. This transfer enabled the bank to clear the payroll checks without delay. The only bank accounts in the EverReady financial statements are the two at 1st National Bank Next, the auditors obtained the December 2017 and January 2018 bank statements for the general and payroll accounts at 1st National Bank. They recorded the bank disbursement and receipt dates in the schedule of interbank transfers. For each transfer, these dates are identical because the accounts are in the same bank. An alert auditor noticed that the 1st National Bank general account bank statement also contains deposits received from Citizen National Bank and canceled check 1799 dated January 5 payable to Citizen National Bank. This check cleared the 1st National Bank account on January 8 and was marked "transfer of funds. This led to the auditors' decision to inquire about this of EverReady's chief financial officer EXHIBIT 6.52.1 Schedule of Interbank Transfer EVERREADY CORPORATION Schedule of Interbank Transfers December 31, 2017 C-5 Prepared Date Reviewed Date Date per Disbursing Account Date per Amount Books 10,463 24-Dec Date per Bank 24-Dec Receiving Account Date per Bank Books 1st National Payroll 24-Dec Bank 24-Dec Bank 1st National Check 1417 Help Save & Exit Check EXHIBIT 6.52.1 Schedule of Interbank Transfers C-5 EVERREADY CORPORATION Schedule of Interbank Transfers December 31, 2017 Prepared Date Reviewed Date Date per Rank Check 1417 1601 1982 Bank 1st National 1st National 1st National Disbursing Account Date per Amount Books 10,463. 24-Dec 11,593. 31-Dec 9,971, 08-Jan Receiving Account Date per Bank Books 1st National Payroll 24-Dec/ 1st National Payroll 31-Dec 1st National Payroll 08-Jan 24-Dec 31-Dec 08-Jan- Date per Bank 24-Dec- 31-Dec 08-Jan Traced from cash disbursements journal Check properly listed as outstanding on bank reconciliation Vouched to check cleared in bank statement + Traced from cash receipts journal - Vouched deposit cleared in bank statement Note: We wamed the cash disbursements and cash receipts malforchete Asked about the Citizen National Bank transactions, EverReady's chief financial officer readily admitted the existence of an off- books bank account. He explained that it was used for financing transactions in keeping with normal practice in the construction industry. He gave the auditors the December and January bank statements for the account at Citizen National Bank. In it, the audite found the following: Check 4050 4051 4052 4053 4054 Citizen National Bank Payable to Amount Dated 1st National $10,000 23-Dec Chase Bank 12,000 28-Dec 1st National 12,000 30-Dec Chase Bank 14,000 4-Jan 1st National 20,000 20.000 8-Jan cleared Bank 29-Dec 31-Dec 05-Jan 07-Jan 13-Jan DULCD Flashcards. Search Textbook Solut.. 4.411 unread - inna Saved Help Save & Exits 4052 4053 4054 1st National Chase Bank 1st National Check my w 12,000 14,000 20,000 30-Dec 4-Jan 8-Jan 05-Jan 07-Jan 13-Jan Deposits Received from Amount Chase Bank $11,000 Chase Bank 15,000 1st National 10,000 Chase Bank 12,000 Date 22-Dec 30-Dec 05-Jan 07-Jan When asked about the Chase Bank transactions, EverReady's chief financial officer admitted the existence of another off-books bank account, which he said was the personal account of the principal stockholder. He explained that the stockholder often used it to finance EverReady's operations. He gave the auditors the December and January bank statements for this account at Chase Bank; in it, the auditors found the following: Payments check# 2220 2221 2222 Chase Bank Payable to Amount Citizen National Bank 11,000 Citizen National Bank 15,000 Citizen National Bank 12,000 Dated 22-Dec 30-Dec 7-Jan Cleared Bank 28-Dec 05-Jan 12-Jan Deposits Received from Citizen National Bank Citizen National Bank Amount 12,000 14,000 Dated 28-Dec 04-Jan Lille National Bank 12,000 7-Jan 03-Jan 12-Jan Deposits Received from Citizen National Bank Citizen National Bank Amount 12,000 14,000 Dated 28-Dec 04-Jan An abbreviated calendar for the period is in Exhibit 6.54.2. EXHIBIT 6.54.2 21 December 2017 January 2018 Required: WOL IS Correct or incorrect for the work you have completed so far. It does not indicate completion Return to question b. What is the actual cash balance for the three bank accounts combined, considering only the amounts given in this case information as of December 31, 2017 (before any of the December 31 payroll checks are cashed by employees)? As of January 8, 2018 (before any of the January 8 payroll checks are cashed by employees)? (Leave no cells blank - be certain to enter"0" wherever required. Negative amounts or amounts to be deducted should be indicated by a minus sign.) Answer is not complete. Check Chase Bank Bank(1) Actual(2) (11,000) 1st National Bank(1) Actual(2) 1st Nat'l Payroll Bank(1) Actual 2220 4050 Citizen National Bank Bank(1) Actual(2) 11,000 11,000 (10,000) 10,000 (10,463) 10,000 (10,463) 10,463 10,46 (10,463) (10.46: Date Dec 22 (Tue) Dec 23 (Wed) Dec 24 Thu). Payroll checks cashed Dec 28 (Mon) Dec 28 (Mon) Dec 29 (Tue) Dec 30 (Wed) Dec 30 (Wed) Dec 31 (Thu) 4051 (12,000) 12,000 (11,000) 2220 4050 (10,000) 15,000 2221 (15,000) 15,000 4052 (12,000) 12,000 (11,593) 12,000 (11,593) 11,503 11,59 1601 MacBook
