Reference no: EM132645795

Sanaoil Company has a current account in Oilsana bank. Your audit of the company's cash account reveals the following:

a. Balances taken from the company's general ledger:

Cash balance, November 30, 2020 P637,860

Cash balance, December 31, 2020 P 576,420

Receipts, December 1-31, 2020 P306,220

B. Outstanding checks, November 30, 2020 (P26,140 was paid by bank in December) P64,140

c. Checks written and recorded in December; not included in the checks returned with the December bank statement, P36,080

d. Deposit in transit, November 30, 2020, P15,260

e. Deposit in transit, December 31, 2020, P16,140

f. A bank credit memo was issued in December to correct an erroneous charge made in November, P1,500

g. Note collected by bank in December (company was not informed of the collection) P2,060

h. A check for P2,020 (payable to a supplier) was recorded in the Check Register in December as 3,000.

i. A check for P2,240 was charged by the bank as P2,420 in December.

j. Bioflu Company issued a stop payment order to the bank in December. This pertains to a check written in December which was not received by the payee. A new check was written and recorded in the Check Register in December. The old check was written off by a journal entry, also in December. P780

k. Bank service charge, November 30, 2020, P60

REQUIRED:

Question 1. Make a four-column proof of a cash reconciling bank balance and balance per books to the correct balance.

Question 2. Using proof of cash, determine the following:

a. Total Outstanding checks on December 31, 2020:

b. Bank statement balance on November 30,2020

c. Bank statement balance on December 31,2020

d. Total bank receipts for the month of December

e. Total bank disbursements for the month of December

Question 3. Make the necessary audit adjusting entries.