The bank statement for the current account of Seals & Crofts Company showed a December 31, 2021 balance of P585,284. Information that might be useful in preparing a bank reconciliation is as follows: Outstanding checks were P52,810.The December 31, 2021 cash receipts of P23,000 were not deposited in the bank until January 2, 2022.One check written in payment of rent, amounting to P8,940, was correctly recorded by the bank but was recorded by Seals & Crofts Company as P9,840.In accordance with prior authorization, the bank withdrew P18,000 directly from the current account as payment on a mortgage note payable. The interest portion of that payment was P14,000. Seals & Crofts Company has made no entry to record the automatic payment.Bank service charges of P740 were listed on the bank statement.A deposit of P35,000 was recorded by the bank on December 12, but it did not belong to Seals & Crofts Company.The bank statement included a charge of P3,400 for an NSF check. The company will seek payment from the customer.Seals & Crofts Company maintains an P8,000 petty cash fund that was appropriately reimbursed at the end of December.According to instructions from Seals & Crofts Company on December 30, the bank withdrew P400,000 from the account and purchased treasury bills for Seals & Crofts Company. The company recorded the transaction in its books on December 31 when it received notice from the bank. Half of the treasury bills mature in three months and the other half in six months. REQUIRED: What is the cash in bank balance per books on December 31, 2021?a. P549,714b. P543,514c. P534,914d. P541,714What is the adjusted cash in bank balance on December 31, 2021?a. P520,474b. P527,274c. P518,674d. P520,154What amount of cash and cash equivalents should be shown under current assets on December 31, 2021?a. P928,474 b. P728,474c. P720,474d. P735,274

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College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter6: Bank Accounts, Cash Funds, And Internal Controls

Section: Chapter Questions

Problem 5E

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The bank statement for the current account of Seals & Crofts Company showed a December 31, 2021 balance of P585,284. Information that might be useful in preparing a bank reconciliation is as follows:

Outstanding checks were P52,810.
The December 31, 2021 cash receipts of P23,000 were not deposited in the bank until January 2, 2022.
One check written in payment of rent, amounting to P8,940, was correctly recorded by the bank but was recorded by Seals & Crofts Company as P9,840.
In accordance with prior authorization, the bank withdrew P18,000 directly from the current account as payment on a mortgage note payable. The interest portion of that payment was P14,000. Seals & Crofts Company has made no entry to record the automatic payment.
Bank service charges of P740 were listed on the bank statement.
A deposit of P35,000 was recorded by the bank on December 12, but it did not belong to Seals & Crofts Company.
The bank statement included a charge of P3,400 for an NSF check. The company will seek payment from the customer.
Seals & Crofts Company maintains an P8,000 petty cash fund that was appropriately reimbursed at the end of December.
According to instructions from Seals & Crofts Company on December 30, the bank withdrew P400,000 from the account and purchased treasury bills for Seals & Crofts Company. The company recorded the transaction in its books on December 31 when it received notice from the bank. Half of the treasury bills mature in three months and the other half in six months.

REQUIRED:

What is the cash in bank balance per books on December 31, 2021?a. P549,714
b. P543,514
c. P534,914
d. P541,714
What is the adjusted cash in bank balance on December 31, 2021?a. P520,474
b. P527,274
c. P518,674
d. P520,154
What amount of cash and cash equivalents should be shown under current assets on December 31, 2021?a. P928,474
b. P728,474
c. P720,474
d. P735,274

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