Kim Lee, the bookkeeper for Briton Company, had never missed a day s work for the past ten years until last week. Since that time, he has not been located. You now suspect that Kim may have embezzled money from the company. The following bank reconciliation, prepared by Kim last month, is available to help you determine if a theft occurred:
Briton Company
Bank Reconciliation for August2003
Prepared by Kim Lee
|
Balance per bank statement |
$192,056 |
Balance per books |
$169,598 |
|
Additions to bank balance: |
Additions to book balance: |
||
|
Deposits in transit |
8,000 |
Note collected by bank |
250 |
|
Deductions from bank balance: |
Interest earned |
600 |
|
|
Outstanding checks: |
Deductions from book balance: |
(1,800) |
|
|
)#201 |
(19,200) |
NSF check |
|
|
#204. |
(5,000) |
Bank service charges. . |
($48) |
|
#205 |
(4,058) |
||
|
#295 |
(195) |
||
|
#565 |
(1,920) |
||
|
#567 |
(615) |
||
|
#568 |
(468) |
||
|
Adjusted bank balance |
$168,600 |
Adjusted book balance |
$168,600 |
In examining the bank reconciliation, you decide to review canceled checks returned by the bank. You find that check stubs for check nos. 201, 204, 205, and 295 indicate that these checks were supposedly voided when written. All other bank reconciliation data have been verified as correct.
Required
1. Compute the amount suspected stolen by Kim.
2. Interpretive Question: Describe how Kim accounted for the stolen money. What would have prevented the theft?