194.Gardener Company had the following transactions during January:
Jan. 10Purchased merchandise at a $8,900 price, invoice dated January 10, terms 1/10, n/30.
13Received a $900 credit memorandum (at full invoice price) for the return of merchandise that it purchased on January 10.
18Purchased merchandise at a $8,500 price, invoice dated January 18, terms 2/10, n/30.
27Paid for the merchandise purchased on January 18, less the discount.
31Paid for the merchandise purchased on January 10. Payment was delayed because the invoice was mistakenly filed for payment today. This error caused the discount to be lost.
Using the net method of recording purchases, prepare the journal entries to record these January transactions.
195.A company established a petty cash fund in April of the current year and experienced the following transactions affecting the fund during April. Prepare journal entries to establish the fund on April 1, to replenish it on April 25, and to record the increase in the fund on April 25.
April 1Prepared a company check for $300.00 to establish the petty cash fund.
25Prepared a company check to replenish the fund for the following expenditures made since April 1.
Paid $84.50 for cleaning services.
Paid $84.00 for postage expense.
Paid $103.15 for office supplies.
Counted $23.35 remaining in the petty cash box.
25The company decides to increase the fund by $100.
196.The following information is available to reconcile Hinckley Company's book balance of cash with its bank statement cash balance as of June 30. The June 30 cash balance according to the accounting records is $57,542, and the bank statement cash balance for that date is $67,047.
a. The bank erroneously cleared a $295 check against the account in June that was not issued by Hinckley. The check documentation included with the bank statement indicates the check was actually issued by Dancer Co.
b. On June 30, the bank issued a credit memorandum for $35 interest earned on Hinckley's account.
c. When the June checks are compared with entries in the accounting records, it is found that Check No. 1727 had been correctly drawn for $1,450 to pay for advertising but was erroneously entered in the accounting records as $1,540.
d. A credit memorandum indicates that the bank collected $9,000 cash on a note receivable for Hinckley, deducted a $30 collection fee, and credited the balance to the company's Cash account. Hinckley did not record this transaction before receiving the statement.
e. A debit memorandum of $865 is enclosed with the bank statement for an NSF check for $840 received from a customer. The bank assessed a $25 fee for processing it.
f. Hinckley's June 30 daily cash receipts of $6,425 were placed in the bank's night depository on that date, but do not appear on the June 30 bank statement.
g. Hinckley's June 30 cash disbursements journal indicates that Check No. 1737 for $4,830 and Check No. 1740 for $3,280 were both written and entered in the accounting records, but are not among the canceled checks.
h. A debit memorandum for $115.00 indicates the bank deducted the annual lock box fee for the company.
1. Prepare the bank reconciliation for this company as of June 30.
2. Prepare the journal entries necessary to bring the company's book balance of cash into conformity with the reconciled cash balance as of June 30.
1.