Question : On June 1, 2009, Jensen Company acquired an 8%, ten-month : 1229757

On June 1, 2009, Jensen Company acquired an 8%, ten-month note receivable from a customer in settlement of an existing account receivable of $130,000. Interest and principal are due at maturity.

127. The proper adjusting entry at December 31, 2009, with regard to this note receivable includes a: 
A. Debit to Cash of $6,067.
B. Debit to Notes Receivable of $10,400.
C. Credit to Interest Revenue of $10,400.
D. Debit to Accrued Interest Receivable of $6,067.

128. Jensen’s entry to record the collection of this note at maturity includes a: 
A. Credit to Accrued Interest Receivable of $6,067.
B. Credit to Interest Revenue of $6,067.
C. Credit to Interest Receivable of $2,600.
D. Credit to Notes Receivable of $140,400.

Correct Journal Entry
 

129. While preparing a bank reconciliation, an accountant discovered that a $426 check returned with the bank statement had been recorded erroneously in the depositor’s accounting records as $462. In preparing the bank reconciliation the appropriate action to correct this error would be to: 
A. Add $36 to the balance per the depositor’s records.
B. Add $36 to the balance per the bank statement.
C. Deduct $36 from the balance per the bank statement.
D. Deduct $36 from the balance per the depositor’s records.

130. The accounting records of Golden Company showed cash of $15,250 at June 30. The balance per the bank statement at June 30 was $15,125. The only reconciling items were deposits in transit of $3,200, outstanding checks totaling $4,100, an NSF check for $1,000 returned by the bank which Golden had not yet charged back to the customer, and a bank service charge of $25. The preparation of a bank reconciliation should indicate cash owned by Golden at June 30 in the amount of: 
A. $14,475.
B. $15,375.
C. $14,225.
D. $15,525.

131. A bank statement shows a balance of $8,445 at June 30. A bank reconciliation is prepared and includes outstanding checks of $2,790, deposits in transit of $1,350, and a bank service charge of $30. Among the paid checks returned by the bank was check no. 900 in the amount of $600, which the company had erroneously recorded in the accounting records as $60. The “adjusted cash balance” at June 30 is: 
A. $6,975.
B. $6,465.
C. $7,005.
D. $7,575.

The Cash account in the ledger of Hensley, Inc. showed a balance of $3,100 at June 30. The bank statement, however, showed a balance of $3,900 at the same date. The only reconciling items consisted of a $700 deposit in transit, a bank service charge of $7, and a large number of outstanding checks.

132. What is the “adjusted cash balance” at June 30? 
A. $3,900.
B. $3,093.
C. $7,600.
D. Some other amount.

133. What is the total amount of the outstanding checks at June 30? 
A. $1,513.
B. $1,486.
C. $1,507.
D. Some other amount.

134. Upon completion of the bank reconciliation, a journal entry will be required to update the depositor’s accounting records. This entry will include a: 
A. Credit to Cash for $700.
B. Debit to Cash for $700.
C. Debit to Cash for $7.
D. Debit to Bank Service Charge Expense for $7.

The Cash account in the ledger of Clear Windows shows a balance of $12,596 at September 30. The bank statement, however, shows a balance of $16,253 at the same date. The only reconciling items consist of a bank service charge of $16, a large number of outstanding checks totaling $6,740, and a deposit in transit.

135. What is the adjusted cash balance in the September 30 bank reconciliation? 
A. $16,237.
B. $12,580.
C. $9,513.
D. $5,856.

136. What is the amount of the deposit in transit? 
A. $5,856.
B. $9,513.
C. $3,067.
D. $3,083.