QUESTION 4 (15 MARKS: 36 MINTUES)

StaySafe Enterprise is a company located in Sintok, Kedah. The cash account for StaySafe Enterprise at 1 November 2020, indicated a balance of RM9,790. The bank statement indicated a balance of RM12,590 on 30 November 2020. Comparing the bank statement, with the companys cash record revealed the following reconciling items:

1. Outstanding Checks: Check No. 1002 totalled RM3,960

Check No. 1003 totalled RM400 Check No. 1004 totalled RM960 Check No. 1005 totalled RM1,960.

2. A cash of RM2,920 representing receipts of 30 November, managed to be deposited to the bank but did not appear on the bank statement.

3. A check for RM580 had been incorrectly charged by the bank as RM850.

4. A check amounted RM690 to settle the companys obligation to Siva Enterprise had been recorded by StaySafe Enterprise as RM960.

5. Bank service charges for November amounted to RM50.

6. A check for RM1,510 from Gangga Enterprise was returned by the bank due to insufficient funds.

REQUIRED:

1. Prepare a bank reconciliation statement as at 30 November 2020.

(6 Marks)

2. Journalize the necessary entries (explanation is not required). The accounts have not been closed.

(2 Marks)

3. Explain TWO (2) principles of internal control.

(4 Marks)

4. State THREE (3) examples of banking activities as control.

(3 Marks)