Reference no: EM132819666
Question - You were able to gather the following from the December 31, 2018 trial balance of Valient Corporation in connection with your audit of the company:
Cash on hand P500,000
Petty cash fund 10,000
BPI current account 1,000,000
Security Bank current account No. 01 1,080,000
Security Bank current account No. 02 (80,000)
PNB savings account 1,200,000
PNB time deposit 500,000
Cash on hand includes the following items:
a. Customer's check for P40,000 returned by bank on December 26, 2018 due to insufficient fund but subsequently redeposited and cleared by the bank on January 8, 2019.
b. Customer's check for P20,000 dated January 2, 2019, received on December 29, 2018.
c. Postal money orders received from customers, P30,000.
The petty cash fund consisted of the following items as of December 31, 2018.
Currency and coins P2,000
Employees' vales 1,600
Currency in an envelope marked "collections for charity" with names attached 1,200
Unreplenished petty cash vouchers 1,300
Check drawn by Valient Corporation, payable to the petty cashier 4,000
P10,100
Included among the checks drawn by Valient Corporation against the BPI current account and recorded in December 2018 are the following:
a. Check written and dated December 29, 2018 and delivered to payee on January 2, 2019,P80,000.
b. Check written on December 27, 2018, dated January 2, 2019, delivered to payee on December 29, 2018,P40,000.
The credit balance in the Security Bank current account No. 2 represents checks drawn in excess of the deposit balance. These checks were still outstanding at December 31, 2018.
The savings account deposit in PNB has been set aside by the board of directors for acquisition of new equipment. This account is expected to be disbursed in the next 3 months from the balance sheet date.
Required - Prepare an adjusting entries?