Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The following information was extracted from the book of Forest Company on 31 January 2005. Cash Book (Bank Column) Bank Statement for month ended 31
The following information was extracted from the book of Forest Company on 31 January 2005.
Cash Book (Bank Column)
Bank Statement for month ended 31 /1/2005 Forest Company | ||||
Date | Particulars | Dt | Ct | Bal |
1 | Bal | 15802.43 | ||
17 | Transfer to credit (Mind Company) | 2985.69 | 18788.12 | |
17 | Cash Depo | 1100.00 | 19888.12 | |
19 | CP - Cheque no 653 | 1862.09 | 18026.03 | |
20 | CP - Cheque no 750 | 824.00 | 17202.03 | |
22 | Transfer of credit (Smart Ltd) | 140.00 | 17342.03 | |
30 | CD - Cheque no 2800 | 4495.00 | 21837.03 | |
30 | Standing Order (ABD Insurance) | 681.00 | 21156.03 | |
30 | CP- Cheque no 659 | 120.00 | 21036.03 | |
30 | CP - Cheque no 658 | 440.50 | 20595.53 | |
31 | CP - Cheque no 652 | 286.44 | 20309.09 | |
31 | Cheque book | 7.50 | 20301.59 |
Cash Book (Bank Column) for the year of 2005 for FOREST COMPANY | ||||||
Particulars | Cheque No | Amount (RM) | Date | Particulars | Cheque No | Amount (RM) |
Balance | 15802.43 | 10 | Furniture Company | 650 | 603.6 | |
Sales | 1100 | 12 | SXY Company | 651 | 220.4 | |
Sales | 2800 | 4495 | 14 | Purchases | 652 | 286.44 |
Comission expenses | 659 | 120 | 17 | Purchases | 653 | 1862.09 |
Account rec (Amin) | 9698 | 600 | 28 | Purchases | 654 | 4430.1 |
29 | Furniture | 655 | 70.4 | |||
29 | SXY Company | 656 | 610.6 | |||
30 | Purchases | 657 | 1226.63 | |||
30 | Purchases | 658 | 440.5 | |||
22117.43 | 31 | Balance | 12366.67 | |||
Balance b/d | 12366.67 | 22117.43 |
Additional information
On 30 January, Forest Company wrongly debited a commission expenses of RM120.00. After further investigation, the following information was obtained:
- Transfer of credit from Mind Company and Smart Ltd of RM2,985.69 and Rm140.00 each respectively were credited in the bank statement. These amounts were not recorded in the business cash book.
- Cheque no 750 for RM824.00 was not a cheque issued by Forest Company, as the cheque number is different from the cheque issued by Forest Company. This chq was issued by another company, but was wrongly recorded by the bank in Forest Company bank statement.
- The bank statement was debited with RM681.00 for payment to an insurance company, ABC Insurance Company. This is a standing order given by Forest Company. This entry was not recorded in the cash book.
- Cheque no 659 issued by Forest Company for RM120.00 was wrongly recorded in the cash book as a receipt. The bank has cleared the cheque and it was correctly recorded in the bank statement.
- Bank statement was debited with RM7.50 for cheque book charges. This was not recorded in Forest Companys book.
- Payment of RM220.00 (chq no 651), RM4,430.10 (chq no 654), RM70.40 (chq no 655), RM610.60 (chq no 656) and RM1226.63 (chq no 657) have been recorded in Forest Companys cash book. However, the payment have not been debited in the bank statement because the cheque were not yet presented to the bank by the recipients of the cheques.
- Receipt from Account receivable Amin for RM600 was recorded in the cash book but was not recorded in the bank statement. This represents a cheque not yet credited on the date the bank statement is issued.
Prepare a bank reconciliation statement by updating the cash book. (80 marks)
KINDLY ANSWER QUESTION A - G
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