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    Proof of Cash

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    Aiden Pats
    The document provides information about preparing a four column proof of cash receipts and disbursements for Albarando Company for August 2008, including bank statements and reconciliation details. Unadjusted book receipts for August were $25,140. Unadjusted book disbursements were $8,460. Adjusted book receipts were $33,640 and adjusted book disbursements were $9,100. The adjusted cash balance as of August 31, 2008 was $73,940.

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    Proof of Cash

    Uploaded by

    Aiden Pats
    4K views2 pages
    The document provides information about preparing a four column proof of cash receipts and disbursements for Albarando Company for August 2008, including bank statements and reconciliation details. Unadjusted book receipts for August were $25,140. Unadjusted book disbursements were $8,460. Adjusted book receipts were $33,640 and adjusted book disbursements were $9,100. The adjusted cash balance as of August 31, 2008 was $73,940.

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    The document provides information about preparing a four column proof of cash receipts and disbursements for Albarando Company for August 2008, including bank statements and reconciliation details. Unadjusted book receipts for August were $25,140. Unadjusted book disbursements were $8,460. Adjusted book receipts were $33,640 and adjusted book disbursements were $9,100. The adjusted cash balance as of August 31, 2008 was $73,940.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    4K views2 pages

    Proof of Cash

    Uploaded by

    Aiden Pats
    The document provides information about preparing a four column proof of cash receipts and disbursements for Albarando Company for August 2008, including bank statements and reconciliation details. Unadjusted book receipts for August were $25,140. Unadjusted book disbursements were $8,460. Adjusted book receipts were $33,640 and adjusted book disbursements were $9,100. The adjusted cash balance as of August 31, 2008 was $73,940.

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    © All Rights Reserved
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    of 2

    Problem 1

    The senior auditor instructed you to prepare a four column proof of cash receipts and disbursements
    for the month of August 2008.
    The bank reconciliation prepared by Albarando Company at July 31 is reproduced below (All book
    disbursements were recorded in August)
    Bank Balance

    52,000

    Add: Deposit in transit, July 31

    900

    Book Balance
    40,000
    Add:
    Proceeds of note receivable
    by bank in July
    8,000
    Deposit made in bank

    on
    Total
    Less: Outstanding checks
    No. 436
    No. 450
    No. 451
    No. 454
    Adjusted balance

    52,900
    200
    1,800
    1,400
    600

    4,000
    48,900

    July 31 not recorded on


    books until August

    Total
    Less: Service Charge

    1,000
    49,000
    100

    Adjusted balance

    ______
    48,900

    Upon inquiry about the clients August 31 bank reconciliation, you were informed hat it has been lost
    and that no client is too busy at this time to prepare another. Your senior auditor told you to get the
    August bank statement and paid checks and to prepare the August 31 reconciliation so that you may
    complete the August proof of cash.
    The August bank statement is reproduced below:
    Davao Bank
    Account name: Albarando Company
    Date
    Debits
    Credits
    July 31
    August 1
    1,800
    900
    August 8
    1,400
    August 9
    600
    10,000
    August 12
    140 EC
    140 EC
    August 15
    1,000
    August 20
    700
    14,000
    August 27
    1,440
    August 29
    100 EC
    100 EC
    August 31
    440 SV
    August 31
    300 DM
    August 31
    1,820
    SV Service Charges; DM Debit Memos; EC Error Corrected; CM Credit Memo
    The paid checks accompanying this bank statement (all clearing in August) were: (checks listed in
    order of payment by bank)
    No. 450
    451
    454

    1,800
    1,400
    600

    No. 455
    456

    1,000
    700

    No. 458
    459

    1,440
    1,820

    The checks register revealed that the last check issued on August was no. 460 for P1,000 and that
    check no. 457 was for P2,400.
    Cash received for the period August 21 through 31 of P9,400 was deposited in the bank on September
    1.

    The debit memo on August 12 and August 31 were customer DAIF checks returned by the bank. The
    check on August 12 was immediately redeposited without entry. The check returned on August 31
    was redeposited by the client in the bank on September 1 without entry.
    Questions: Based on the application of the necessary audit procedures and appropriation of the above
    daa, you are to provide the answer to the following:
    1. How much is the unadjusted book receipts for August?
    a. P 25,140
    b. 42,400
    c. P 35,540
    2. How much is the unadjusted book disbursements for August?
    a. P 8,460
    b. P 9,740
    c. P 8,760

    d. P 43,360
    d. P 8,360

    3. How much is the adjusted book receipts for August?


    a. P 33,640
    b. P 33,450
    c. P 34,400

    d. P 33,400

    4. How much is the adjusted book disbursement for August?


    a. P 9,100
    b. P 8,900
    c. P 9,200

    d. P 9,340

    5. How much is the adjusted cash balance as of August 31, 2004?


    a. P 73,940
    b. P 73,060
    c. P 73,400

    d. P 73,200

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