Option #1: Proof of Cash

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wraaynyr

Business Finance

Description

You must use the computer-based Electronic Audit Documentation in Excel on the textbook's website to prepare the proof of cash required in this problem. Please refer to Lynda.com video tutorials for assistance working with Excel. Lynda.com can be found on CSU-Global Library database.

The auditors of Steffey Ltd. decided to study the cash receipts and disbursements for the month of July of the current year under audit. They obtained the bank reconciliations and the cash journals prepared by the company accountants, which revealed the following:

June 30: Bank balance, $355,001; deposits in transit, $86,899; outstanding checks, $42,690; general ledger cash balance, $399,210.
July 1: Cash receipts journal, $650,187; cash disbursements journal, $565,397.
July 31: Bank balance, $506,100; deposits in transit, $51,240; outstanding checks, $73,340; general ledger cash balance, $484,000. Bank statement record of deposits: $835,846; of payments: $684,747.

Required:

In Excel, prepare a four-column proof of cash (see Exhibit 6.13 for an example) covering the month of July of the current year. Identify problems, if any.

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a. Prepare a four-column proof of cash covering the month of July of the current year. (Nec should be indicated by a minus sign.) Balance June 30 Deposits Payments Balance July 31 Bank statement amounts Deposits in transit June 30 July 31 Outstanding checks June 30 July 31 Unrecorded deposit Unrecorded disbursement General ledger amounts b. Does the proof of cash reveal any problemis?
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Explanation & Answer

Find the attached, best regards
Attached.

Bal. june30
Per bank statement

$3,55,001

Deposit
$86,899

Deposit in transit
1-Jul
31-Jul

$6,50,187
$51,240

Outstanding checks
1-Jul
31-Jul
Unrecorded deposit
Bank error, excess disbursement
Balance as per general ledger
Opening balance as per ledger
Cash receipt- July1
Cash disbursement July 1

$22,100

$3,5...


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