Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

image text in transcribedimage text in transcribed

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. Deposits: Date 2/4 2/11 2/18 2/25 2/26-2/28 Amount $ 2,000 Checks: 1,600 2,500 3.400 No. 321 322 323 324 325 326 327 Date 2/2 2/8 2/12 2/19 2/27 2/28 2/28 Amount $4,000 450 1,800 1,500 250 750 1,200 $9,950 Cash receipts: 900 $10,400 Balance on February 1 Receipts Disbursements Balance on February 28 $ 6,100 10,400 (9,950) $ 6,550 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 $9,610. b. Cash receipts of $900 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 $250 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 $1,300. g. Oscar's checking account earns interest based on the average daily balance. The amount of interest earned for February is $130. h. In January, one of Oscar's suppliers, Titanic Fabrics, borrowed $4,600 from Oscar. On February 24, Titanic paid $4,750 ($4,600 borrowed amount plus $150 interest) directly to Academy Bank in payment for January's borrowing, 1. Academy Bank charged service fees of $120 to Oscar's for the month. 2. Record the necessary cash adjustments. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Total entries to the same account together when entering in the journal entry worksheet.) View transaction list Journal entry worksheet e. Lilek 32 Was willen lur D2,DUU TOI duver Sily in reviudly. The Dailk propery ieculueu lile lileCK TUI LIIS INTUITL f. An automatic withdrawal for Oscar's February rent was made on February 4 for $1,300. g. Oscar's checking account earns interest based on the average daily balance. The amount of interest earned for February is $130. h. In January, one of Oscar's suppliers, Titanic Fabrics, borrowed $4,600 from Oscar. On February 24, Titanic paid $4,750 ($4,600 borrowed amount plus $150 interest) directly to Academy Bank in payment for January's borrowing. i. Academy Bank charged service fees of $120 to Oscar's for the month. 2. Record the necessary cash adjustments. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Total entries to the same account together when entering in the journal entry worksheet.) View transaction list Journal entry worksheet

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

The Routledge Companion To Auditing

Authors: David Hay, W. Robert Knechel, Marleen Willekens

1st Edition

1138363081, 978-1138363083

More Books

Students also viewed these Accounting questions