Why should cash receipts be deposited on the day of receipt?
Depositing all receipts upon the arrival of receipt creates an independent record of how much cash was received and keeps a team member safe from personal use of the money for a while before depositing it.
A cash receipt is a printed form statement showing how much money got in a cash sale transaction. This receipt is duplicated and given to the customer, while one more duplicate is held for bookkeeping.
Mostly the theft of money happens before making a record of the receipt. When a record is made, it is simpler to follow a theft. When possible, deposit all money receipts unblemished, ideally on the day they are more susceptible to misappropriation.
Choose from the following list of terms/phrases to best complete the following statements.
a. Cash c. Outstanding check e. Bank reconciliation
b. Cash equivalents d. Liquidity f. Current assets
3. The __________ category includes short-term, highly liquid investment assets that are readily convertible to a known cash amount and sufficiently close to their due dates so that their market value is not sensitive to interest rate changes.
The following annual account balances are taken from Armour Sports at December 31.
Accounts receivable . . . . . . . . . . . $ 100,000 $ 85,000
Net sales . . . . . . . . . . . . . . . . . . . . 2,500,000 2,000,000
What is the change in the number of days’ sales uncollected between years 2016 and 2017? (Round the number of days to one decimal.) According to this analysis, is the company’s collection of receivables improving? Explain.
Blues Music Center had the following petty cash transactions in March of the current year. March 5 Wrote a $250 check, cashed it, and gave the proceeds and the petty cashbox to Jen Rouse, the petty cashier.
6 Paid $12.50 COD shipping charges on merchandise purchased for resale, terms FOB shipping point. Blues uses the perpetual system to account for merchandise inventory.
11 Paid $10.75 in delivery expense on merchandise sold to a customer, terms FOB destination.
12 Purchased office file folders for $14.13 that are immediately used.
14 Reimbursed Bob Geldof, the manager, $11.65 for office supplies purchased and used.
18 Purchased office printer paper for $20.54 that is immediately used.
27 Paid $45.10 COD shipping charges on merchandise purchased for resale, terms FOB shipping point.
28 Paid postage expense of $18.
30 Reimbursed Geldof $56.80 for mileage expense.
31 Cash of $61.53 remained in the fund. Sorted the petty cash receipts by accounts affected and
exchanged them for a check to reimburse the fund for expenditures.
31 The petty cash fund amount is increased by $50 to a total of $300.
1. Prepare the journal entry to establish the petty cash fund.
For each of the following items a through g, indicate whether its amount (1) affects the bank or book side of a bank reconciliation, (2) represents an addition or a subtraction in a bank reconciliation, and (3) requires an adjusting journal entry.
Bank or Book Side Add or Subtract Adj. Entry or Not
c. Minimum balance charge. . . . . . . . . . . . . . .
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