[Minder86]

Hi there, I had a bank reconciliation question and its getting me very mad. I had a problem with one question. How would you put this into the bank reconciliation:

Cash sales of $638 on May 12 were deposited in the bank. The journal entry to record the cash sales and the deposit slip to deposit the cash were correctly made out for $638. The bank credited the genetics company for $386.

[morgaine300]

First figure out the difference between the two amounts to see how much it's off.

Then keep in mind that the bank is who screwed it up, so it needs adjusted on their side, cause they don't have the right balance.

Now, if the deposit was $638 but the bank only recorded $386 to their account, does the bank need to add or subtract that difference to make things right? That is your adjustment.

Give that a try. Someone can let you know if you're correct.

[pready]

There is no adjusting entry required for you. It is an adjusting entry for the bank since they inputted the incorrect amount.

You will need to call the bank and have them correct their error.

[Minder86]

Hi there, Im interested in starting a program in accounting at ubc. I was not sure what I wanted to do but found accounting interesting. I had a hard time figuring this out. I needed help with the answer :

On otctober 1, 2007, fpo Corp, issued $600,000 of 10 year, 6% bonds at 98. The bonds pay interest annually on otctober 1. FPO's year end is September 30.

1. record the issue of the bonds on October 1, 2007.

2. record the accrual of interest on September 30, 2008, assuming the amortization amount is $2,127.

3. record the payment of interest on October 1, 2008

4. assume that on October 1, 2008, after payment of the interest, FPO redeems all of the bonds at 102. Record the redemption on the bonds.

This is the answers that I have. If you see anythign wrong with it. Let me know and please let me know how to solve this question :)

my answers :

1. cash (600,000 x 98%) 588,000
discount on bonds payable 12,000
bonds payable 600,000

2. Interest Expense (36,000 + 2,127) 38,127
Discount on Bonds Payable 2,127
Cash (6% x 600,000 x 12/12) 36,000

After that I wasn't sure.

[morgaine300]

There is no adjusting entry required for you. It is an adjusting entry for the bank since they inputted the incorrect amount.

You will need to call the bank and have them correct their error.

A bank reconciliation and adjusting entries are two different things. This does need to be on the reconciliation because the bank's balance will be incorrect and will never balance with the company's balance. (And while they do need to call the bank, this is only a homework problem after all.)

[morgaine300]

Minder, I answered your bond one on the other thread. It would be nice if you would a) only post follow-ups on the same question on the same thread (not new problems), cause this gets confusing, and b) not post the same question two different places, cause that gets confusing too. Thanks.