4.

The following data are available for the cash in bank of Ellen Company for February of the current year:
a. Deposit made by the company this February, 120,000.
b. Deposit in Transit, January 31, 200,000.
c. Customer’s check representing receipts in January amounting to 21,000 was erroneously recorded
by the company as 12,000.
d. Check of the company in January amounting to 2,000 was erroneously recorded by the company as
20,000.
e. Deposit acknowledged by the bank in February, 150,000.
f. Erroneous bank charge in January, 13,000.
g. Erroneous bank credit in February, 14,000.
h. Customer’s note collected, January 31, 10,000.
i. Customer’s note collected, February 28, 12,000.

Required:
a. Deposit in Transit in February 28.

Deposit in transit, Jan. 31 200,000

Add: Deposit made by the company February
Total
Less: Deposit acknowledged by the bank this month Deposit in Transit,
Feb. 28

b. Unadjusted book receipts in February.

The following are the adjusting entries to be recorded in the company’s books. Note that only book
reconciling items are recorded.

Deposit made by the company - February 120,000 Add: Credit memo in January 31 - Customer's
notes collected 10,000
Errors in January corrected in February's book receipt:
Understatement of cash receipts in January for Customer's check (P21,000- P12,000) 9,000
Overstatement of cash disbursements in January for customer's check (P20,000-
P2,000) Total unadjusted book receipt

c. Unadjusted bank receipts in February.

Deposit acknowledged by the bank - February 150,000

Add: Credit memo in February (customer's notes collected) 12,000
Errors in January corrected in February's bank receipt:
Overstatement of cash disbursements in January (erroneous bank charge January) 13,000
Errors in February affecting bank receipts:
 Overstatement of cash receipt in February (erroneous bank credit February) Total
unadjusted bank receipts

5. In your audit of the cash account of Ann Company, you have ascertained the following data relative to the
debits per books and credit per bank:
Book debits in February 380,000
Bank credits in February 310,000
Interest earned on the deposits in January but taken up in the books in February 5,000
Interest earned on the deposits in February but taken up in the books in March, 6,000
Collection by the bank for the account of the depositor (this amount was collected
by the bank in January but was taken up in the books of the depositor in February 15,000 Loan
granted by the bank to the depositor (this amount was credited by the bank
on February 27 but not yet taken up in the books of the depositor in February 30,000 Check from
customer in January amounting to 20,000 but was taken up in the book as 2,000
Check issued to supplier in January amounting to 1,000 but was taken up in the book as 10,000
Erroneous bank credit-February, 18,000
Undeposited collections as of January 31 250,000

Required: Compute for the undeposited collections at the end of February.

250,000
Undeposited collections, Jan. 31

Add: Deposits made by the company

Book Debits 380,000

Less: Interest earned in January 5,000

Collection by the bank in January 15,000

Understatement of CR in January (P20,000-P2,000) 18,000

Overstatement of CD in January (P10,000- 9,000 333,000

P1,000)

Total 583,000

Less: Deposits acknowledged by the bank

Bank Credits 310,000

Less: Interest earned in February 6,000

Loan granted by the bank in February 30,000

Erroneous bank credit - February 18,000

Erroneous bank charge - January 10,000 246,000
Undeposited collections, Feb. 28 337,000
6, The following data are available for the Cash in Bank of Rizza Company for
February of the current year:
a. Checks issued by the company during February, 150,000.
b. Outstanding checks, January 31, 52,000.00
 c. Customer’s check, representing receipts in January amounting to 12,000 was erroneously
recorded by the company as 21,000.
d. Check of the company in January amounting to 20,000 was erroneously recorded by the
company as 2,000.
e. Checks paid by the bank in February, 130,000.
f. Erroneous bank charge in January, 10,000.
g. Erroneous bank charge in February, 12,000.
h. Bank service charge, January, 2,000.
i. Bank service charge, February, 3,000.

Required: Compute for the following:

1. Outstanding checks on February 28.

Outstanding checks, Jan. 31 52,000

Add: Checks issued by the company - February
Total
Less: Checks paid by the bank - February
Outstanding checks, Feb. 28

2. Unadjusted book disbursement in February.

Checks issued by the company - February 150,000

Add: Debit memo in January (bank service charge) 2,000
Errors in Jan. corrected in February’s book disbursement:
Overstatement of cash receipts in January for customer's check (P21,000-P12,000) 9,000
Understatement of cash disbursements in January for customer's check (P20,000-
P2,000) Total unadjusted book disbursement

3. Unadjusted bank disbursement in February.

Checks paid by the bank - February 130,000

Add: Debit memo in February (bank service charge) 3,000
Errors in January corrected in February's bank disbursements:
Overstatement of cash receipts in January (erroneous bank credit January 31) 10,000
Error in February affecting bank disbursements:
Overstatement of cash disbursements in February (erroneous bank charge)
Total unadjusted bank disbursement

7. In the audit of the cash account of the Prudylyn Inc., the following information, relative to the credits
per books and debits per bank, were disclosed by the records of the company and its bank statement with BPI:
• Credits per books in February, 200,000
 • Debits per bank statement in February, 150,000
• Check from customer in January amounting to 2,000 but was taken up in the books as, 20,000.
• Check issued to supplier in January amounting to 10,000 but was taken up in the book as, 1,000 
Check issued to supplier in February amounting to 12,000, but was taken up in the book as,
21,000.
• Check of the company recorded in the bank in January as 10,000 when the correct amount is
15,000.
• Amortization of pag-ibig housing loan automatically debited by the bank on January 31, as per
automatic debit agreement, but taken up in the books of the depositor in February, 15,000
• Amortization of pag-ibig housing loan automatically debited by the bank on February 28, as per
automatic debit agreement, but taken up in the books of the depositor in March, 15,000
• Erroneous Bank Credit- January, 18,000
• Erroneous Bank Charge – February 10,000
• Deposits in January properly recorded by the company as 15,000 but was recorded in the bank as
51,000
• Outstanding checks, January 31, 15,000  Bank Service charge for January, 1,000.
• Bank service Charge for February, 2000.

Required: Compute for the outstanding checks at the end of February.

Outstanding checks, January 31 15,000

Add: Checks issued by the company this month

Book credits 200,000

Less: Overstatement of CR in January (P20,000- 18,000
P2,000)
Understatement of the CD in January 9,000
(P10,000-P1,000)

Overstatement of CD in February (P21,000-P12,000) 9,000

Amortization of PAG-IBIG housing loan in 15,000
January
Bank service charge January 1,000 148,000
Total 163,000
64,000
Less: Checks by the bank

Bank credits
150,000
Less: Understatement of CD in January (P15,000-
P10,000)
5,000
Amortization of PAG-IBIG housing loan in
15,000 18,000
February
10,000
Erroneous bank credit - January
36,000
Erroneous bank charge - February
2,000
Overstatement of deposit (P51,000-P15,000)
Bank service charge February
 99,000
Outstanding checks, February 28

8. Data concerning the cash records of Lyndon Company for the months of September and October of
the current year follow:
a. Undeposited book balance on September 30 amounted to 2,258,000.
b. Total receipts per book in October, 1,400,000.
c. Total disbursements per book in October, 2,400,000.
d. Unadjusted bank balance on September 30 amounted to 2,100,000
e. Total credits per bank in October amounted to 1,200,000.
f. Total debits per bank in October amounted to 2,500,000.
g. NSF checks on September 30 amounted to 60,000 while on October 31 amounted to 40,000.
h. Collection of accounts receivable not recorded by the company on September 30, 30,000 and
50,000 on October 31.
i. Erroneous bank charge on September 30, 10,000 and 18,000 on October 31.
j. Erroneous bank credit on September 30, 7,000 and 9,000 on October 31.
k. Understatement of check in payment of rent payable on September 30, 90,000 and 120,000 on
October 31.
l. Deposit in Transit on September 30, 130,000.
m. Outstanding checks on October 31, 30,000.

Required: Based on the above data, answer the following questions:

a. How much is the deposit in transit, October 31?
Deposit in transit, beginning 130,000

Add: Deposits made by the company

Book receipts 1,400,000

Less: Credit last month 30,000 1,370,000
Total 1,500,000
Less: Deposits acknowledged by the bank

Bank receipts 1,200,000

Less: Credit memo this month 50,000

Erroneous bank charge - September 10,000

Erroneous bank credit - October 9,000 1,131,000

369,000
Deposit in transit, end
b. How much is the outstanding checks, September 30?

Outstanding checks, beginning

end 95,000

Add: Checks issued by the company

Book Disbursements 2,400,000

Less: Debit last month 60,000
Understatement of check in payment of rent September
90,000
Add: Understatement of check in payment of rent October
120,000 2,370,000
Total 2,465,000

Less: Checks paid by the bank

Bank disbursements 2,500,000

Less: Debit memo this month 40,000

Erroneous bank charge - October 18,000

Erroneous bank credit - September 7,000 2,435,000

30,000

c. How much is the adjusted cash in bank balance September 30?

d. How much is the adjusted cash receipts during October?
e. How much is the adjusted cash in bank balance October 31?
Balance October Balance
 Sept. 30 Receipts Disbursement Oct. 31
Bank Balance 2,100,000 1,200,000 2,500,000 800,000
Deposit in transit
130,000
Sept. 30 (130,000)

Oct. 31 369,000
369,000
Outstanding checks
(95,000)
Sept. 30 (95,000)

Oct. 31 30,000
(30,000)
Erroneous bank charge
10,000 (10,000)
Sept. 30

Oct. 31
(18,000) 18,000
Erroneous bank credit

Sept. 30 (7,000) (7,000)

Oct. 31 (9,000) (9,000)

Adjusted Balance c. 2,138,000 d. 1,420,000 2,410,000 e. 1,148,000

Balance October Balance

Sept. 30 Receipts Disbursement Oct. 31

Book Balance 2,258,000 1,400,000 2,400,000 1,258,000
NSF checks
(60,000)
Sept. 30 (60,000)

Oct. 31 40,000
(40,000)
Credit memo Sept. 30
30,000
Oct. 31 (30,000)
Understatement of checked in payment of 50,000
rent
50,000
Sept. 30 (90,000)
Oct. 31 (90,000)
Adjusted Balance 120,000 (120,000)
f. Provide the adjusting journal entries.
c. 2,138,000 d. 1,420,000 2,410,000 e. 1,148,000
Adjusting Entries Debit Credit
1.) Accounts Receivable 40,000
 Cash in bank 40,000

2.) Cash in bank 50,000

Accounts Receivable 50,000

3.) Rent payable 120,000

Cash in bank 120,000