Question

eeper of stealing. Here are some detalls of the business S Cash position at December 31, 2017 Additional Information a. The Cash account shows a balance of $10,430. This amount includes a December 31 deposit of $3,828 that does not appear on the December 31 bank statement. b. The December 31 bank statement shows a balance of $8,727. The bank statement lists a $270 bank collection, an $15 service charge, and a $52 NSF cheque. The bookkeeper has not recorded any of these items. c. At December 31, the following cheques are outstanding: Cheque No. Amount 118 154 $ 148 820 994 293 141 d. The bookkeeper records all incoming cash and makes bank deposits. He also reconciles the monthly bank statement. Here is his December 31 reconciliation: $ 10,430 1,922 270 12,622 Balance per books, December 31. ......... Add: Outstanding cheques.... Bank collection Subtotal. Less: Deposits in transit. Service charge NSF cheque Balance per bank, December 31 ...$ 3,828 15 52 $ (3,895) 8,727 Print Done

Answer 1

Gray Construction Inc. Bank Reconciliation December 31, 2017
Bank
Balance as per bank		$ 8,727
Add: Deposits in Transit		3,828
		12,555
Less: Outstanding checks		2,422
Adjusted bank balance		10,133
Books
Balance per books		10,430
Add: Bank collection		270
		10,700
Less: NSF Cheque	52
Service Charge	15	67
Adjusted book balance		10,633

Based on the above reconciliation, it appears the bookkeeper has stolen $ 500. The bookkeeper has understated the total of outstanding cheques by $ 500 to cover the theft. The owner should assign the bank reconciliation to another employee or do it himself.