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Duke Companys unedusted bank balance at March 31 is $3850. The bank reconciliation revealed outstanding checks amounting to
Abbott Company purchased $7300 of merchandise inventory on account. Abbott uses the perpetual inventory system. Which of the
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Answer #1

1) True cash balance is

Unadjusted Cash balance = $3,850

Add: Deposits in Transit = $460

Less: Outstanding Checks = $580

True Cash balance = $3,730

2) Inventory Purchased Account.................Debit $7,300

To Accounts Payable account..................Credit $7,300

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