Consider the following: Cash in Bank – checking account of $18700, Cash on hand
ID: 2437133 • Letter: C
Question
Consider the following: Cash in Bank – checking account of $18700, Cash on hand of $450, Post-dated checks received totaling $3330, and Certificates of deposit totaling $120000. How much should be reported as cash in the balance sheet?
If the month-end bank statement shows a balance of $148000, outstanding checks are $48000, a deposit of $17000 was in transit at month end, and a check for $2300 was erroneously charged by the bank against the account, the correct balance in the cash account at month end is
Explanation / Answer
Answer to Question 1.
Cash Balance to be reported in Balance Sheet = Cash in Bank + Cash in Hand
Cash Balance to be reported in Balance Sheet = $18,700 + $450
Cash Balance to be reported in Balance Sheet = $19,150
Answer to Question 2.
Correct Balance in Cash Account = Bank Balance – Outstanding Checks – Deposit in Transit + Checks erroneously charged
Correct Balance in Cash Account = $148,000 - $48,000 - $17,000 + $2,300
Correct Balance in Cash Account = $85,300