Prepare bank reconciliation on December

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Reference no: EM132873495

Question - Alpha company provided the following information for the month of December:

Cash balance per ledger 5,000,000

Cash balance per bank statement 5,500,000

Proceeds of bank loan discounted on

December 1 for one year at 14% 516,000

Undeposited collections on December 31 300,000

Check of Omega company had been incorrectly deducted by bank from Alpha Company account 50,000

Check of Alpha Company in payment of an account payable had been recorded by the depositor as 20,000. The correct amount is 200,000

The ledger account for cash was the only cash account kept by the entity. It included a petty cash account comprised of the following items:

Currency and coin 4,000

Supplies 2,000

Transportation 3,000

Postage 1,000 10,000

Deposit of Omega Company credited by the bank to the account of Alpha company 130,000

Deposit of December 27 omitted from bank statement 150,000

Outstanding checks 544,000

Required -

a. Prepare bank reconciliation on December 31.

b. Prepare one journal entry only necessary to adjust the cash account.

Reference no: EM132873495

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