The Cash Account

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The Cash Account

Lecture number:
Lecture Note
Miami University, Oxford
Acc 221 - Intro to Financial Accounting
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Lecture 13 Outline of Previous Lecture  Chapter Reviews: The Accounting Cycle  Accounting Cycle Process  All accounts in Cycle o (P) = Permanent Accounts, (T) = Temporary Accounts Outline of Current Lecture  Section 13: The Cash Account  Cash Account Entries o Cash Account: money goes in or comes out o Bank Reconciliation  Bank Balance is Wrong o Deposits Outstanding o Check Outstanding  Company Balance is Wrong o Service Charges o Collection of a Note Current Lecture  Section 13: The Cash Account  Cash Account Entries o Within the cash account, money either goes in or comes out; complexities arise with how we control the cash  Internal controls – reconciling the balance of the cash account with outside entity (bank)  If all transactions are correct and up-to-date in both, this will verify the amount of money in accounts.  Look at what you know about (balance) v. what they know about (bank balance)  Reconciliation happens outside of accounting cycle; however, transactions may be added if need be  Transactions may be written all at once, or in separate entries o Bank Reconciliation  2 halves; Company side = ending balance  Bank side = bank ledger  Both act as the starting points  Bank balance is wrong o Deposit outstanding ACC 221 1st Edition

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