Question

question 3 (5 points)
using the following information, determine the adjusted cash balance per bank for santas packaging on november 30.

cash balance on the bank statement	$2,350
customers check returned-nsf	500
customers note collected by the bank	600
deposits in transit, november 30	1,400
outstanding checks, november 30	2,650

• $1,250
• $1,550
• $1,350
• $1,100

question 4 (5 points)
internal control over a companys assets should include which of the following?

• responsibilities and duties of employees will be divided.
• all cash receipts will be deposited into the bank the same day they arrive.
• all cash payments will be made by check (except petty cash).
• all of the above

Explanation:

Identify bank reconciliation adjustments

Using the Bank Reconciliation knowledge point:

• Cash balance on the bank statement: \(\$2,350\)
• Deposits in transit: \(\$1,400\) (add to bank balance)
• Outstanding checks: \(\$2,650\) (deduct from bank balance)
• Note: Customer's NSF check and note collected by bank adjust the book balance, not the bank balance.

Calculate adjusted cash balance per bank

Using the Bank Reconciliation knowledge point:

$$ \text{Adjusted Bank Balance} = \text{Bank Statement Balance} + \text{Deposits in Transit} - \text{Outstanding Checks} $$

$$ \text{Adjusted Bank Balance} = \$2,350 + \$1,400 - \$2,650 = \$1,100 $$

Evaluate internal control principles

Using the Internal Controls knowledge point:

• Dividing responsibilities and duties (segregation of duties) prevents fraud.
• Depositing cash receipts daily protects liquid assets.
• Making payments by check provides a documented audit trail.
• Therefore, all listed options are correct.

Answer:

Question 3

• (A) $1,250
• (B) $1,550
• (C) $1,350
• (D) $1,100 (Correct answer)

Question 4

• (A) Responsibilities and duties of employees will be divided.
• (B) All cash receipts will be deposited into the bank the same day they arrive.
• (C) All cash payments will be made by check (except petty cash).
• (D) All of the above (Correct answer)