On December 1, 2017, Papadopoulos SA had the following account balances.
During December, the company completed the following transactions.
1. Depreciation €200 per month.
2. Insurance expired €400.
(a) Journalize the December transactions. (Assume a perpetual inventory system.)
(b) Enter the December 1 balances in the ledger T-accounts and post the December transactions. Use Cost of Goods Sold, Depreciation Expense, Insurance Expense, Salaries and Wages Expense, Sales Revenue, and Sales Discounts.
(c) The statement from Athens Bank on December 31 showed a balance of €25,930. A comparison of the bank statement with the Cash account revealed the following facts.
1. The bank collected a note receivable of €2,000 for Papadopoulos on December 15.
2. The December 31 receipts were deposited in a night deposit vault on December 31.
These deposits were recorded by the bank in January.
3. Checks outstanding on December 31 totaled €1,210.
4. On December 31, the bank statement showed an NSF charge of €680 for a check received by the company from A. Quinn, a customer, on account.
Prepare a bank reconciliation as of December 31 based on the available information. (Hint: The cash balance per books is €26,100. This can be proven by finding the balance in the Cash account from parts (a) and (b).)
(d) Journalize the adjusting entries resulting from the bank reconciliation and adjustment data.
(e) Post the adjusting entries to the ledger T-accounts.
(f) Prepare an adjusted trial balance.
(g) Prepare an income statement for December and a classified statement of financial position at December 31.
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