Cottage Co

question 16

Essay

Cottage Co.deposits all cash receipts on the day when they are received and it makes all cash payments by check.At the close of business on December 31,its Cash account shows a debit balance of $36,606.The company's bank statement as of December 31 shows an ending cash balance of $31,842.The following information was also available.
Outstanding checks as of December 31 total $4,522.
Included with the bank statement was a debit memo in the amount of $70 for bank service charges.
Check No.2519,listed with the canceled checks,was correctly drawn for $805 in payment of a utility bill on December 16.The company mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $895.
The December 31 cash receipts of $6,850 were placed in the bank's night depository after banking hours and were not recorded on the December 31 bank statement.
The bank deducted $2,456 for an NSF check from a customer deposited on December 10.
Required:
Prepare the journal entries for the items that would appear on the company's bank reconciliation as of December 31.(If no entry is required for a transaction/event,select "No Journal Entry Required" in the first account field. )

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Definitions:

Taxable Year

The one-year period that is used for calculating taxes, which can be either a calendar year or a fiscal year.

Property Tax Rate

The percentage of the assessed value of real estate that is payable as tax to the local government.

Mills

In the context of property tax, a mill represents one-tenth of one cent. This unit of currency is often used in tax assessments and signifies the amount of tax payable per dollar of the assessed value of a property.

Gross Income

The total income earned by an individual or a business before any deductions or taxes are taken.