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Fantom [35]
2 years ago
13

The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6: Cash balance

according to the company’s records at August 31, $42,920. Cash balance according to the bank statement at August 31, $56,300. Checks outstanding, $25,390. Deposit in transit not recorded by bank, $13,325. A check for $150 in payment of an account was erroneously recorded in the check register as $1,500. Bank debit memo for service charges, $35. a. Prepare a bank reconciliation, using the format shown in Exhibit 13.
Business
1 answer:
EastWind [94]2 years ago
6 0

If for August 20Y6: Cash balance according to the company’s records at August 31, $42,920. Cash balance according to the bank statement at August 31, $56,300. The bank reconciliation statement will be:

  • Adjusted bank  balance $44,235
  • Adjusted cash balance  $44,235

Creative Design Co. Bank Reconciliation

August 31, 20Y6

Cash balance according to bank statement $56,300

Add deposit in transit $13,325

Less outstanding checks ($25,390)

Adjusted bank  balance  $44,235

Cash balance according to company's records  $42,920

Add error in banking recording check as $1,500 instead of $150  $1,350

Less Bank charges ($36)

Adjusted cash  balance  $44,235

Inconclusion if for August 20Y6: Cash balance according to the company’s records at August 31, $42,920. Cash balance according to the bank statement at August 31, $56,300. The bank reconciliation statement will be:

  • Adjusted bank  balance $44,235
  • Adjusted cash balance  $44,235

Learn more here:

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In "open market operations" to __________ M1, the securities held by a commercial bank (or the public) are exchanged for "cash"
Hoochie [10]

Answer:

expand

Explanation:

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The Fed buys securities from banks holding it, for money; so as to increase the supply of money in the economy.

4 0
2 years ago
On December 31, 2021, Interlink Communications issued 6% stated rate bonds with a face amount of $100 million. The bonds mature
Sauron [17]

Answer:

The bonds were issued at $87,590,959

Explanation:

The bonds will be issued at the present value of the coupon and maturity discounted by the market rate

C \times \frac{1-(1+r)^{-time} }{rate} = PV\\

C 6,000,000.000 ( 100 million x 6%)

time 30 (2051 - 2021)

market rate 7% = 7/100 = 0.07

6000000 \times \frac{1-(1+0.07)^{-30} }{0.07} = PV\\

PV $74,454,247.1010

PV of the maturity

\frac{Maturity}{(1 + rate)^{time} } = PV  

Maturity   100,000,000.00

time   30.00

rate  0.07

\frac{100000000}{(1 + 0.07)^{30} } = PV  

PV   13,136,711.72

Total current value of the bonds:

PV coupon  $ 74,454,247.1010

PV maturity  $<u>  13,136, 711.7155 </u>

Total             $87,590,958.8165

8 0
2 years ago
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance
Nikolay [14]

Answer:

Please see the detailed solution below:

Explanation:

Solution 1:

Average Operating Assets = (Beginning Operating Assets + Ending Operating Assets) / 2

Average Operating Assets = ($1,850,000 + $1,890,000) / 2

Average Operating Assets = $3,740,000 / 2

Average Operating Assets = $1,870,000

Solution 2:

Margin = Net Operating Income / Sales

Margin = $589,050 / $3,927,000

Margin = 0.15 i.e., 15%

Turnover = Sales / Average Operating Assets

Turnover = $3,927,000 / $1,870,000

Turnover = 2.1

Return on Investment = Margin x Turnover

Return on Investment = 15% x 2.1

Return on Investment = 31.5%

Solution 3:

Residual Income = Net Operating Income - (Minimum Required Rate of Return x Average Operating Assets)

Residual Income = $589,050 - (15% x $1,870,000)

Residual Income = $589,050 - $280,500

Residual Income = $308,550

8 0
3 years ago
On October 1, 20X6, Susan Thompson opened Thompson Decorating Services, a sole proprietorship. Susan began operations with $50,0
galben [10]

Answer: income statement: Net income $5,100, Statement of owners Equity :Total $35,100, Balance sheet : Total Liabilities $53,200, Total Asset $53,200

Explanation:

Thompson Decoration Services

Income Statement for the month ended 31 st October 20X6

$

Revenue. 18,300

Less Expenses

Salaries. 8,700

Advertising 2,500

Less: outstanding 700

-------

1,800

Taxes. 150

Postage. 1,800

Utilities. 100

Interest. 450

Miscellaneous. 200

------------

13,200

--------------

Net income. 5,100

-----------------

Statement of owners Equity for the month ended 31st October 20X6

Common Stock. Paid in capital. Retained Earnings Treasury stock Total

Balance Oct 1. 30,000. 30,000

Issued share for cash. - - - - -

Purchase of treasury stock - - - - -

Net income. - - 5,100. 5,100

Cash dividend. - - - - -

Stock dividend. - - - - -

------ ------ --------- ---------- -------------

Balance on Oct 31. - - 5,100 - 35,100

---------- -------- -------- ---------- --------------

Thompson Decoration Service

Balance sheet for the month ended 31st October 20X6

$

Current Asset

Debtors. 4,100

Account Receivable 14,200

-----------

Total Current Asset. 18,300

Fixed Asset

Van. 16,000

Office Equipment. 4,000

Furnishing. 14,900

-----------

Total Fixed Asset. 34,900

--------------

Total Asset. 53,200

---------------

Long term Liabilities

Capital. 30,000

Add: Net income 5,100

----------

35,100

Less: Drawing. 5,500

-----------

29,600

Loan. 20,000

-----------

Total Long term Liabilities 49,600

Current Liabilities

Outstanding 2,800

Interest. 450

Taxes. 150

Miscellaneous 200

--------------

Total Current Liabilities 3,600

--------------

Total Liabilities. 53,200

----------------

4 0
3 years ago
Read 2 more answers
Classify each of the following in terms of their effect on interest rates (increase or decrease): I. Covenants on borrowing beco
kozerog [31]

Answer: I decreases; II decreases; III decreases

Explanation:

Debt Covenants becoming more restrictive means that less people want to borrow money. This shifts the demand curve to the left and this Decreases interest rates.

The Fed increasing money supply means that there is more money in the economy. This shifts the supply curve to the right thus having the effect of reducing Interests rates as there is more money available for loans.

Total Household Wealth increasing means that Households have less of an incentive to borrow money. This reduces the demand for interest rates so interest rates decrease.

5 0
3 years ago
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