Question

Question 1 (30 minutes, 25 marks) You are given the following information for River Adventures Company River Adventures Company Bank Reconciliation April 30, 2019 9.009 546 9,855 Cash balance per bank Add: Deposit in transit Less: Outstanding cheques: 3526 8533 1541 8555 Adjusted cash balance, bank 363 79 2.079 7,776 The adjusted cash balance per bank agreed with the cash balance per books at April 30, 2017. The May bank statement showed the following: Bank Statement Cheques / Charges Deposit Number Amount Amount Balance Date Apr. 30 May 3 526 541 556 1,358 363 6 61 101 5571.800 105 59 1,650 13 13 14 561 799 18562 2,045 18 19 563 2.487 21 564603 25 565 1,033 26 28 NSF 440 31 SC 25 9.009 846 8,497 8.134 7.911 1.250 7,361 9808.341 6.691 4 267 ,117 1,650 8,767 7,968 5,923 2 22 6.145 3,658 3 ,055 2,022 980 3,002 1 ,771 4,333 4,308 Additional information from the bank statement 1. The deposit of $1,650 on May 13 is an electronic transfer from a customer in payment of its account. The amount includes $35 of interest, which River Adventures had not previously recorded. 2. The NSF for $440 is for a $425 cheque from a customer, Ralph King, in payment of his account plus a $15 processing fee. 3. SC represents bank service charges for the month. 4. The bank made one error when processing cheque #564. All cheques were written to pay accounts payable: all cash receipts were collections of accounts receivable, The company's cash payments and cash receipts for the month were as follows:

Answer 1

RIVER ADVENTURES COMPANY Part-a) Bank Reconciliation for May 31, 2017 Particulars Amount Cash balance at bank Add: Deposit in transit Add: Bank error on check #564 Amount $4,308 $1,286 $297 $5,891 Less: Outstanding cheques #533 #555 #558 #560 #566 Adjusted Cash balance as per bank $279 $79 $943 $890 $950 $3,141 $2,750 $1,075 Cash balance in Cash Book ( 7776 +6825 - 13526) Add: Amount received not recorded Excess payment recorded check #563 Short receipt recorded ($980 - $890) $1,650 $400 $90 $2,140 $3,215 Add: Adjustments Check deposit Return Bank Charge Unadjusted Cash balance $440 $25 $465 $2,750 Credit Debit $1,650 Part-b) Date Particulars 31-May-17 Bank A/C To Accounts Receivable A/C To Interest Income A/C (Being electronic transfer received from customer) $1,615 $35 $400 31-May-17 Bank A/C To Accounts payable A/C (Being Excess payment recorded check #563) $400 $90 31-May-17 Bank A/C To Accounts Receivable A/C (Being Short receipt recorded) $90 $425 $15 31-May-17 Accounts Receivable A/C Bank Charge A/C To Bank A/C (Being NSF check return of Ralph King) $440 31-May-17 Bank Charge A/C To Bank A/C (Being Bank charges recorded) $25