Bank Reconciliation

Problem 1
Fermin Company’s check register shows the following entries for the month of December
Date Checks Deposits Balance
2014
1-Dec Beginning Balance 89,300.00
5-Dec Deposit 65,000.00 154,300.00
7-Dec Check # 14344 32,500.00 120,800.00
11-Dec Check # 14345 14,000.00 106,800.00
26-Dec Deposit 49,000.00 155,800.00
29-Dec Check # 14346 8,600.00 147,200.00

Fermin’s Bank reconciliation for November revealed one outstanding check (No.14343) for P12,000
(written on November 28), and one deposit in transit for P5,550 (made on November 29)

The following is from Fermin’s bank statement for December 2014:

Date Checks Deposits Balance
2014
1-Dec Beginning Balance 95,750.00
1-Dec Deposit 5,550.00 101,300.00
4-Dec Check no. 14344 32,500.00 68,800.00
5-Dec Deposit 56,000.00 124,800.00
14-Dec Check no. 14345 14,000.00 110,800.00
15-Dec Loan Proceeds 500,000.00 610,800.00
20-Dec NSF Check 7,600.00 603,200.00
29-Dec Service Charge 1,000.00 602,200.00
31-Dec Interest 3,600.00 605,800.00

Assume that all errors were committed by Fermin Company, not the bank

Based on the preceding information, determine the following:

1. Adjusted Cash Balance on November 30 ___________________
2. Outstanding checks on December 31 ____________
3. Deposit In transit on December 31 __________
4. Total bank receipts in December _________
5. Adjusted Cash Balance on December 31 ________________

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Answer/Solution (Problem 1)

1. Balance per Bank , Nov 30 P 95,750

Outstanding Check (no.14343) (12,000)
Deposit in Transit 5,550
Adjusted Cash Balance, Nov 30 P 89,300

2. Outstanding Checks on Dec 31

Check no. 14343 P12,000
Check no. 14646 8,600
Total P 20,600

3. Deposit in transit on Dec 31:

Dec 26 collection P 49,000

4. Total Bank receipts in December P 565,150

5.

Book Bank
Unadjusted Balances 147,200.00 605,800.00
Deposit in Transit 49,000.00
Outstanding Checks (see no.2) (20,600.00)
Error in recording deposit
(P65,000 - P56,000) (9,000.00)
Error in Arithmetic for Check no. 14344 1,000.00
Loan Proceeds 500,000.00
NSF Check (7,600.00)
Interest 3,600.00
Service Charge (1,000.00)
Adjusted Balances 634,200.00 634,200.00

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 *Source - CPAR Handouts (Batch 82 - October 2017)