Accounting, Office II - CH. 6
reported on the balance sheet as a current asset
Short-term investments owned by a company are?
the reconciliation of the cash balance per the company records to the adjusted cash balance.
A bank reconciliation sometimes points to the need for adjusting entries. In general, the source of the adjustments is?
The proceeds of a note collected by the bank are deposited to the account.
A credit memorandum accompanying a bank statement would occur for ?
a debit to Unrealized Loss on Short-Term Investments
During its first year of operation, Lenton Company acquired three short-term investments. Investment A cost $50,000 and had a year-end market value of $60,000. Investment B cost $35,000 and had a year-end market value of $17,000. Investment C cost $26,000 and had a year-end market value of $24,000. The journal entry to record the decline in market value would include?
$10,000
During its first year of operation, Lenton Company acquired three short-term investments. Investment A cost $50,000 and had a year-end market value of $60,000. Investment B cost $35,000 and had a year-end market value of $17,000. Investment C cost $26,000 and had a year-end market value of $24,000. What amount should be reported as a charge against income in Lenton's income statement for the first year of operation?
$7,313
Malory Company provides the following information about the month-end bank reconciliation: The correct ending cash balance is? Ending cash per bank statement $1,367 Ending cash per company records $7,383 Monthly bank service charge $25 Deposits in transit at month-end $8,345 Outstanding checks at month-end $2,399 Customer check returned NSF $45
debit misc expense 25, debit AR 45, credit cash 70
Malory Company provides the following information about the month-end bank reconciliation: What journal entry should be recorded to cause the company records to be correct? Ending cash per bank statement $1,367 Ending cash per company records $7,383 Monthly bank service charge $25 Deposits in transit at month-end $8,345 Outstanding checks at month-end $2,399 Customer check returned NSF $45
ending balance per company records
Monthly bank service charges are subtracted in the reconciliation of a certain "amount" to the correct adjusted cash balance. What is the "amount" in question?
Travel advances to employees
The Cash account on the balance sheet should not include?
petty cash receipts
The original amount of a petty cash fund should be equal to cash remaining in the fund plus which?
cash
The replenishment of a petty cash fund involves a credit to which of the following accounts?
false
True or False. Companies may legally use the "float," even to the extent of writing checks when no money is in an account.
false
True or False. Only decreases in value are recognized for short-term investments.
true
True or False. The Cash account is listed on the balance sheet in the current asset section, and all cash items are normally combined and reported as a single figure.
false
True or False. The accounting department should have exclusive control over the functions of cash collection, bank deposits, recording appropriate journal entries, and preparing the periodic bank reconciliation.
true
True or False. The initial recording of short-term investments is at cost, including brokerage fees.
true
True or False. The items reported in the Cash account on the balance sheet must be acceptable to a bank for deposit and free from restrictions for use in satisfying current debts.
true
True or False. The reconciliation of the cash balance per company records to the correct adjusted cash balance would indicate the need for journal entries.
Added to the balance per the bank statement.
When reconciling the ending cash balance per the bank statement to the correct adjusted cash balance, how would deposits in transit be handled?
none of the above
When using a petty cash system, the replenishment of the fund would normally include a debit to cash, petty cash, revenues, or none of the above?
outstanding checks
Which of the following items would be subtracted from the balance per bank statement in adjusting to the correct adjusted cash balance? Outstanding checks or NSF checks?