Earnings per share on capital stock outstanding ($17,920 ÷ 10,000 shares) $1.79 Req. 2 Receivables = Net = $135,100 = 8.89 Turnover Average Net Trade $15,200* Accounts Receivable * ($16,000 + $14,400) ÷ 2 The receivables turnover ratio measures the effectiveness of credit-granting and collection activities. P6–6. Req. 1 JEFFERSON COMPANY Bank Reconciliation, April 30, 2014 Company's Books Bank Statement Ending balance per Cash Ending balance per bank account $23,900 statement $26,070 Additions: Additions: Interest collected 1,180 Deposits in transit* 4,400 25,080 30,470 Deductions: Deductions: NSF—A.B. Wright 160 Outstanding checks 5,600 Bank charges 50 210 Correct cash balance $24,870 Correct cash balance $24,870 *$41,500 - $37,100 = $4,400. Req. 2 (1) Cash (+A) 1,180 Interest revenue (+R, +SE) 1,180 Interest collected. (2) Accounts receivable (A. B. Wright) (+A) 160 Cash (–A) 160 Customer's returned, insufficient funds. (3) Bank service charge expense (+E, 50 –SE) Cash (–A) 50 Bank service charges deducted from bank statement.
Earnings per share on capital stock outstanding ($17,920 ÷ 10,000 shares) $1.79 Req. 2 Receivables = Net = $135,100 = 8.89 Turnover Average Net Trade Accounts Receivable $15,200* * ($16,000 + $14,400) ÷ 2 The receivables turnover ratio measures the effectiveness of credit-granting and collection activities. P6–6. Req. 1 JEFFERSON COMPANY Bank Reconciliation, April 30, 2014 Company's Books Bank Statement Ending balance per Cash account $23,900 Ending balance per bank statement $26,070 Additions: Additions: Interest collected 1,180 Deposits in transit* 4,400 25,080 30,470 Deductions: Deductions: NSF—A.B. Wright 160 Outstanding checks 5,600 Bank charges 50 210 Correct cash balance $24,870 Correct cash balance $24,870 *$41,500 - $37,100 = $4,400. Req. 2 (1) Cash (+A) 1,180 Interest revenue (+R, +SE) 1,180 Interest collected. (2) Accounts receivable (A. B. Wright) (+A) 160 Cash (–A) 160 Customer's returned, insufficient funds. (3) Bank service charge expense (+E, –SE) 50 Cash (–A) 50 Bank service charges deducted from bank statement.
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