Reference no: EM132851023

Question - Dempsey Corporation keeps all its cash in a checking account. Presented below are the company's bank reconciliation prepared at the end of May, the general ledger account for cash, and a summary of the company's bank statement for June:

Dempsey Corporation Bank Reconciliation May 31

Balance per bank statement P 6,250

Add: Deposit in transit 225

6,475

Deduct: Outstanding checks 418

Correct cash balance P 6,057

Balance per books P 6,072

Deduct: Bank service charge 15

Correct cash balance P 6,057

CASH

Balance, June 1 P 6,057 June Disbursements P25,679

June Receipts 26,182

Summary of Dempsey Corporation's Bank Statement for June

Balance, June 1 P 6,250

Deposits shown for June 25,692

Note and interest collected during June 1,575

Checks that cleared during June (25,707)

June Service charge (17)

Balance, June 30 7,793

Additional information:

1. During June, Dempsey Corporation incorrectly recorded two checks. Check no 507 was drawn for P233 but recorded as P323; check no. 521 was drawn for P180 but recorded as P18. Both checks were issued in payment of accounts payable and cleared the bank in June.

2. During June the bank erroneously charged a P210 check of Kamia Company to Dempsey Corporation's account.

3. Of the P1,575 note and interest collected by the bank during June, P75 represents interest, all of which Dempsey earned during the current year. The company has not yet recorded the collection.

Required -

1. Prepare June 30, bank reconciliation.

2. Prepare journal entries to bring Dempsey Corporation's accounting records up to date.

3. What amount should Dempsey report as cash on the balance sheet dated June 30?