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149
E5–13
E5–14
The use of the voucher system is appropriate, the essentials of which are out-
lined below. (Although invoices could be used instead of vouchers, the latter
more satisfactorily provide for account distribution, signatures, and other signifi-
cant data.)
1. Each voucher should be approved for payment by a designated official only
2. The file for unpaid vouchers should be composed of 31 compartments, one
4. At the time of payment, all vouchers and supporting documents should be
150
E5–15
To prevent the fraud scheme described, Torpedo must separate responsibilities
for related operations. As in the past, all service requisitions should be submitted
E5–16
E5–17
151
E5–18 KAYCEE SISTERS INC.
Bank Reconciliation
July 31, 20Y9
Cash balance according to bank statement ................................. $18,330
E5–19
Increase in Cash
Balance Sheet
Statement of Assets =Liabilities +Stockholders’ Equity Income
Cash Flows Statement
Cash =Accounts Payable
Decrease in Cash
Balance Sheet
Statement of Assets =Liabilities +Stockholders’ Equity Income
Cash Flows Retained Statement
Cash = Earnings
Aug. 31. (50) (50) Aug. 31.
152
E5–20
Balance Sheet
Statement of Assets =Liabilities +Stockholders’ Equity Income
Cash Flows Notes Retained Statement
Cash + Receivable = Earnings
E5–21
a.
WESTWIND CO.
Bank Reconciliation
August 31, 20Y6
Cash balance according to bank statement .................... $17,325
Add: Deposit in transit on August 31 ............................... 2,175
b. $15,310
153
E5–22
A correct bank reconciliation would be as follows:
DAKOTA CO.
Bank Reconciliation
June 30, 20Y3
Cash balance according to bank statement: $ 22,900
Deduct outstanding checks:
No. 7715 .................................................... $1,450
154
E5–23
a. The amount of cash receipts stolen by the sales clerk can be determined by
attempting to reconcile the bank account. The bank reconciliation will not re-
concile by the amount of cash receipts stolen. The amount stolen by the sales
clerk is $7,125, determined as shown below.
PALA CO.
Bank Reconciliation
April 30, 20Y1
Cash balance according to bank statement .......................................... $28,175
b. The theft of the cash receipts might have been prevented by having more
than one person make the daily deposit. Collusion between two individuals
155
E5–24
a.
Balance Sheet
Statement of Assets =Liabilities +Stockholders’ Equity Income
Cash Flows Petty Statement
Cash +Cash
b.
Balance Sheet
Statement of Assets =Liabilities +Stockholders’ Equity Income
Cash Flows Office Retained Statement
Cash + Supplies = Earnings
(610) 325 (285)
156
E5–25
a.
Balance Sheet
Statement of Assets =Liabilities +Stockholders’ Equity Income
Cash Flows Petty Statement
Cash + Cash
b.
Balance Sheet
Statement of Assets =Liabilities +Stockholders’ Equity Income
Cash Flows Office Retained Statement
Cash + Supplies = Earnings
(455) 175 (280)
Statement of Cash Flows Income Statement
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