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Chapter 5

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Chapter 5

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  1. Chapter 5 Cash Control Systems

  2. 12. Checking accounts Pages 119 - 121 Checking account– a bank account from which payments can be ordered by a depositor Endorsement– a signature or stamp on the back of a check transferring ownership Blank endorsement– only consist of endorser’s signature Special endorsement– an endorsement indicating a new owner of the check Restrictive endorsement – an endorsement restricting further transfer of a check’s ownership

  3. Blank Endorsement Special Endorsement Restrictive Endorsement ENDORSEMENTS page 120 LESSON 5-1

  4. Preparing a check Page 121 • Write the date (month, day, year) • Postdated check – a check with a future date on it • Write to whom the check is to be paid • Write the amount in figures following $ • Write the amount in words before the word Dollars • Write the purpose of the check following the word For • Sign the check

  5. Preparing a check stub Page 121 Write the amount of the check Write the date (month, day, year) Write to whom the check is to be paid Record the purpose of the check Write the amount of the check following amt this check Calculate the new checking account balance

  6. RECORDING A VOIDED CHECK page 122 2 4 1 3 5 1. Record the date. 2. Write the word VOID in the Account Title column 3. Write the check number. 4. Place a check mark in the Post. Ref. column. 5. Place a dash in the Cash Credit column. LESSON 5-1

  7. 13. Bank Reconciliation Pages 124 - 127 Bank statement– a report with deposits, withdrawals, and bank balances sent to a depositor by a bank Code of conduct – a statement that guides the ethical behavior of a company

  8. 10 BANK STATEMENT RECONCILIATION page 125 1. Date 1 2. Check Stub Balance 2 5 3. Service Charge 6 4. Adjusted Check Stub Balance 3 7 5. Bank Statement Balance 6. Outstanding Deposits 8 4 9 7. Subtotal 8. Outstanding Checks 9. Adjusted Bank Balance 10. Compare Adjusted Balances LESSON 5-2

  9. RECORDING A BANK SERVICE CHARGE ON A CHECK STUB page 126 LESSON 5-2

  10. 1. Date. Write the date. 2 JOURNALIZING A BANK SERVICE CHARGE page 127 August 31. Received bank statement showing August bank service charge, $8.00. Memorandum No. 3. 4 1 3 2. Debit. Write the title of the account to be debited. Record the amount debited. 3. Credit. Record the amount credited. 4. Source document. Write the source document number. LESSON 5-2

  11. Recap: • 1. What account is a bank service charge journalized? • 2. What does it mean if a deposit or check is OUTSTANDING? • 3. Are outstanding checks added or subtracted from the adjusted bank balance side of the bank reconciliation?

  12. 14. Dishonored Checks & Electronic Banking Pages 129 - 132 Dishonored check– a check that a bank refuses to pay Electronic funds transfer (EFT) – a computerized cash payments system that transfers funds without the use of checks, currency, or other paper documents Debit card – a bank card that automatically deducts the amount of a purchase from the checking account

  13. RECORDING A DISHONORED CHECK ON A CHECK STUB page 129 LESSON 5-3

  14. 1. Date. Write the date. 2 JOURNALIZING A DISHONORED CHECK page 130 November 29. Received notice from the bank of a dishonored check from Campus Internet Café, $70.00, plus $35.00 fee; total, $105.00. Memorandum No. 55. 1 4 3 2. Debit. Write the title of the account to be debited. 3. Credit. Write the amount credited. 4. Source document. Write the source document number. LESSON 5-3

  15. 1. Date. Write the date. 2 JOURNALIZING AN ELECTRONIC FUNDS TRANSFER page 131 September 2. Paid cash on account to Kelson Enterprises, $350.00, using EFT. Memorandum No. 10. 4 1 3 2. Debit. Write the title of the account to be debited. Record the amount debited. 3. Credit. Record the amount credited. 4. Source document. Write the source document number. LESSON 5-3

  16. 1. Date. Write the date. 2 JOURNALIZING A DEBIT CARD TRANSACTION page 132 September 5. Purchased supplies, $24.00, using debit card. Memorandum No. 12. 4 1 3 2. Debit. Write the title of the account to be debited. Record the amount debited. 3. Credit. Record the amount credited. 4. Source document. Write the source document number. LESSON 5-3

  17. 15. Petty Cash Pages 134 - 136 Petty cash – an amount of cash kept on hand and used for making small payments Petty cash slip – A form showing proof of a petty cash payment

  18. 1. Date. Write the date. 2 ESTABLISHING A PETTY CASH FUND page 134 August 19. Paid cash to establish a petty cash fund, $100.00. Check No. 8. 4 1 3 2. Debit. Write the title of the account to be debited. Record the amount debited. 3. Credit. Record the amount credited. 4. Source document. Write the source document number. LESSON 5-4

  19. 1. Date. Write the date. 2 REPLENISHING PETTY CASH page 136 August 31. Paid cash to replenish the petty cash fund, $30.00: miscellaneous expense, $20.00; advertising, $10.00. Check No. 12. 4 1 3 2. Debit. Write the title of the first account to be debited. Write the amount to be debited. Write the title of the second account to be debited. Record the amount to be debited. 3. Credit. Record the amount credited. 4. Source document. Write the source document number. LESSON 5-4