Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On December 31, 2024, Lally Company had a cash balance per books of $8,981. The bank statement on that date showed a balance $10,155. A

image text in transcribed
On December 31, 2024, Lally Company had a cash balance per books of $8,981. The bank statement on that date showed a balance $10,155. A comparison of the statement with the Cash account revealed the following: 1. The statement included debit memos of $70 for the printing of additional company cheques and $30 for bank service charges. 2. Cash sales of $417 on December 12 were deposited in the bank. The journal entry to record the cash receipt and the deposit slip were incorrectly made out and recorded by Lally as $741. The bank detected the error on the deposit slip and credited Lally Company for the correct amount. 3. The November 30 deposit of $985 was included on the December bank statement. The deposit had been placed in the bank's night deposit vault p November 30. 4. The December 31 deposit of $960 was not included on the December bank statement. The deposit had been placed in the bank's night deposit vault on December 31. 5. Cheques \#1006 for $415 and #1072 for $975 were outstanding on November 30. Of these, \#1072 cleared the bank in December. All the cheques written in December except for $1278 for $555, "1284 for $646, and #1285 for $315 had cleared the bank by December 31 . 6. On December 18, the company issued cheque #1181 for $457 to Harper & Co. on account. The cheque, which cleared the bank in December, was incorrectly journalized and posted by Lally Company for $574. 7. A review of the bank statement revealed that Lally Company received electronic payments from customers on account of $1,875 in December. The bank had also credited the account with $25 of interest revenue on December 31 . Lally had no previous notice of these amounts. 8. Included with the cancelled cheques was a cheque issued by Mally Company for $585 that was incorrectly charged to Lally Company by the bank. 9. On December 31, the bankstatement showed an NSF charge of $805 for a cheque issued by W. Hoad, a customer, to Lally Company on account. This amount included a $16 service charge by the bank. The company's policy is to pass on all NSF fees to the customer

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Contemporary Auditing

Authors: Michael C. Knapp

9th Edition

1133731244, 9781133731245

More Books

Students also viewed these Accounting questions

Question

=+Who are you right now, and where do you want to be?

Answered: 1 week ago