Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Journal Entry #1 Record the amounts of Increase cash Journal Entry #2 Record the amounts of decreasing cash Oscar's Red Carpet Store maintains a checking
Journal Entry #1 Record the amounts of Increase cash
Journal Entry #2 Record the amounts of decreasing cash
Oscar's Red Carpet Store maintains a checking account with Academy Bank. Oscar's sells carpet each day but makes bank deposits only once per week. The following provides information from the company's cash ledger for the month ending February 28, 2021. Date Amount No. Date Amount 2/4 2,100 Checks: 1,700 2/2 2/8 2/12 2/19 $4,100 Deposits: 321 2/11 322 600 2/18 1,900 1,600 2,600 323 2/25 3,500 324 Cash receipts: 2/26-2/28 1,000 2/27 325 400 $10,900 2/28 326 900 2/28 1,300 327 $10,800 Balance on February 1 $ 6,200 Receipts Disbursements 10,900 (10,800) 6,300 Balance on February 28 Information from February's bank statement and company records reveals the following additional information: Information from February's bank statement and company records reveals the following additional information: a. The ending cash balance recorded in the bank statement is $9,840. b. Cash receipts of $1,000 from 2/26-2/28 are outstanding. c. Checks 325 and 327 are outstanding. d. The deposit on 2/11 includes a customer's check for $400 that did not clear the bank (NSF check) e. Check 323 was written for $2,500 for advertising in February. The bank properly recorded the check for this amount. f. An automatic withdrawal for Oscar's February rent was made on February 4 for $1,200. g. Oscar's checking account earns interest based on the average daily balance. The amount of interest earned for February is $140. h. In January, one of Oscar's suppliers, Titanic Fabrics, borrowed $4,800 from Oscar. On February 24, Titanic paid $5,000 ($4,800 borrowed amount plus $200 interest) directly to Academy Bank in payment for January's borrowing. i. Academy Bank charged service fees of $100 to Oscar's for the month Record the necessary cash adjustments. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the st account field. Total entries to the same account together when entering in the journal entry worksheet.)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