Question 1 -

Part a) Jack's Dance Company provided you with the following information, from which you are to prepare the 2009 October bank reconciliation as well the corresponding journal entries to make the books correct and complete:

Balance per bank - October 31, 2009                                                  $217,000.08

Bank service charge for the month                                                                73.00

NSF check (received from customer) returned with bank statement             1,780.95

Note collect by bank during the month                                                    64,000.00

Interest on note collected during the month                                             12,800.00

Outstanding checks at month end                                                          43,087.45

Deposits in transit at month end                                                             23,754.90

Balance per company records - Oct 31, 2009                                       122,721.48

Part b)

Using your assigned public company's latest 10K, please copy and paste the Accounting Policy addressing Cash and Cash Equivalents. Note - this is normally located early in the Notes to the Financial Statements section.

Question 2 - Walter & Company has produced the following detailed aging of outstanding accounts receivable as at December 31, 2009.

Required:

(a) Prepare an aging analysis and show how accounts receivable and the related allowance for doubtful accounts would appear in the balance sheet at December 31, 2009.           

(b) Prepare the necessary journal entry to update the allowance for doubtful accounts assuming that the balance prior to preparing the aging was a credit of $100,000.                                

(c) One of the customers, Janet, who was in the "Over 180" days category owed $60,000. On January 15, 2010, it was revealed that Janet was officially declared bankrupt and would only be able to repay a quarter of what she owed to any company. Prepare the journal entry to write off Janet's uncollectible debt.                                                                                              

(d) On January 31, 2010, Janet won the lottery and on the same day she decided to repay all of her original debts to everyone whom she owed money. Prepare the journal entry to record Walter's unexpected receipt of Janet's payment.