The KLM company maintains five bank accounts- City Bank General, City Bank Payroll and City Bank Branch # 1, City Bank Branch # 2, and City Bank Branch # 3. Your analysis of cash disbursements records for the period December 2014 reveals the following bank transfers:

Check No.	City Bank Account			Disbursement Date		Receipt date
	From	To	Amount	Per book	Per Bank	Per book	Per Bank
4100	General	Payroll	$100,000	Dec 31	Jan 3	Dec 31	Jan 2
4275	General	Branch # 1	200,000	Dec 31	Jan 4	Jan 2	Jan 2
4280	General	Branch # 2	100,000	Jan 2	Jan 2	Dec 31	Dec 31
B 403	Branch # 3	Payroll	50,000	Jan 2	Jan 3	Jan 3	Dec 31

All checks are issued on December 31, 2014.

Required:

1. What are the purposes of the audit of bank transfer?
2. Prepare separate adjusting entries for any checks that require adjustment.
3. Indicate the check numbers that should appear as:
   1. An outstanding checks
   2. A deposit in transit
4. Which checks may be indicative of kiting?