Day 51: Cash Payments and Banking

Chapter 7 Problems

Textbook Pages

• pg 359 Multiple Choice Question 1
• pg 360 Exercise 1
• pg 364 Discussion Questions 1, 2, 3, 4, 5
• pg 364 Basic Exercise 7-1
• pg 365 Exercises 7-2 & 7-3

Watch the following videos and take notes:

• Internal Controls for Cash (5:00)
• Bank Reconciliation Intro (7:33)
• Bank Rec - Bank Side (3:41)
• Bank Rec - Book Side (4:36)
• Bank Rec - Adjusting Entries (3:28)
• Bank Reconciliations (13:49)
• Bank Reconciliations (8:50) 
• Reconciliation of Bank Accounts (5:40) 

Preview Next Topics

Types of "Cash"

• Currency (bills)
• Coins
• Money Orders

 Change Fund

• money put in cash registers to make change for customers

 Sources of Cash Receipts:

• Cash Sales at cash register
• Checks received on account through the mail
•  with Remittance Advice
• EFT Receipts
•  faster
•  easier
•  safer
•  more accurate
•  better control

Cash Sales Journal Entry
Cash (asset)                                108
Cash Short and Over (expense)      2
         Sales (revenue)                             100
         Sales Tax Payable (liability)            10

Voucher System

• vouchers show proof of authority to make a payment

Banking Advantages

• Safer
• limits amount of cash on hand at business
• makes it easier to transfer money
• independent (3rd party) verification and recording of cash transactions

Credit Memo = Debit Cash

• EFT receipts
• Collection of note proceeds
• interest earned

Debit Memo = Credit Cash

• EFT payments
• NSF checks
• non-sufficient funds, bounced checks we deposited
• debit A/R, credit Cash
• bank fees