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Trust tutorial part 1

Souk - Bob

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3 pages

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/,).!2%!,%34./24(#!2!4%#/--)33)/.Although this fi rst step is not required, we recommend documenting all funds re-1AUDITOR'Sceived by preparing receipts for cash and photocopying all checks, money orders, etc.FIRST OF THREE-PART SERIES.1/4/0XDATE No. 750410$ 1,200RECEIVED FROM Charles Clark Rental Trust Account Twelve hundred & 00/100 DOLLARS FOR RENT $600 Rent, $600 Sec Dep 143 North BlvdFOR Deposit Cycle 1,200 00 CASH ACCOUNT Jan 1 Jan 31 From To 1/4/0XDATE No. 750411PAYMENT 1,200 00 CHECKBy MONEY $Blake Stephens0 1,100RECEIVED FROMBAL. DUE ORDEREleven hundred & 00/100 DOLLARSAccount for rental funds with receipts, FOR RENT $550 Rent, $550 Sec Dep 2500 Johnson StFORphotocopies, validated bank deposit tickets 1,100 00 CASHACCOUNT Jan 1 Jan 31and worksheets, journal and ledger entries. From ToPAY M E N T 1,100 00 CHECK John BrokerByMONEYBAL. DUE 0 ORDERDeposit funds in an insured NC bank and keep a copy of the 2 Make a record of the deposit with a Supplemental Deposit bank-validated deposit ticket in Worksheet identifying remitter/tenant, property, purpose and 3your trust account fi lesamount. Balance cash receipts and check copies with deposit DEPOSIT ticket and supplemental deposit worksheet. Cross reference YOUR REALTY COMPANY, INC. deposit ticket to Supplemental Deposit Worksheet.TRUST ACCOUNT DATE 1/4/0XSUPPLEMENTAL DEPOSIT WORKSHEET # 0X-2 ...

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Publié par	Souk
Nombre de lectures	33
Langue	English

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FIRSTOFTHREE-PARTSERIES.

Although this ﬁrst step is not required, we 1ceived by preparing receipts for cash and recommend documenting all funds re-photocopying all checks, money orders, etc.

1/4/0X No. 750410 DATE $1,200 Charles Clark RECEIVED FROM Rental Trust AccountTwelve hundred & 00/100 DOLLARS FOR RENT $600 Rent, $600 Sec Dep143 North Blvd Deposit Cycle FOR 1/4/0X DATENo. 750411 $1,100 RECEIVED FROMBlake Stephens Eleven hundred & 00/100 Account for rental funds with receipts, DOLLARS FOR RENT $550 Rent, $550 Sec Dep2500 Johnson St photocopies, validated bank deposit tickets FOR 00CASH ACCOUNT1,100 Jan1 Jan31 and worksheets, journal and ledger entries. From To PAYMENT1,100 00 CHECK John Broker By MONEY BAL. DUE0 ORDER Deposit funds in an insured NC 2 bank and keep a copy of the Make a recoro t eepos t w ta uppementa epost bank-validated deposit ticket in 3amount. Balance cash receipts and check copies with deposit Worksheet identifying remitter/tenant, property, purpose and your trust account ﬁles DEPOSITticket and supplemental deposit worksheet. Cross reference YOUR REALTY COMPANY, INC. deposit ticket to Supplemental Deposit Worksheet. TRUST ACCOUNT DATE1/4/0X SUPPLEMENTAL DEPOSIT WORKSHEET # 0X-2 DepositTicket #2 DOLLARS CENTS 1/4/0X Cross-Reference CURRENCYSDW$2,300 00 REMITTER/BUYER/ PROPERTYPURPOSE AMOUNT COINS TENANT CHECKS Clark 143North BoulevardSecurity Deposit$600.00 1. Clark 143North BoulevardJan Rent$600.00 2. Stephens 2500Johnson StreetSecurity Deposit$550.00 3.Stephens 2500Johnson StreetJan Rent$550.00 4. TOTAL$2,300.00 TOTAL$2,300 00 Balance Post the date and amount of funds deposited andRecord the transaction on the ledger identifying 4 5 reference the corresponding deposit ticket andthe property, the parties to the transaction, the Supplemental Deposit Worksheeton the journal.amount, date and purpose of the deposit and from whom received. YOUR REALTY COMPANY, INC. TRUST ACCOUNT JOURNAL NAME:Gerald Howard, Owner - - Clark, TenantACCOUNT NO. NC Insured Bank A/C# 123-456-7890 ADDRESS:143 North BoulevardNO. SHEET DATE DESCRIPTIONNUM DEPOSITSCHECKS BALANCE DATE ITEMSDEPOSITS CHECKS BALANCE 1/03/0X DEPOSIT0X-1$3,600.00 $3,600.00 √$600.00 $600.00Clark 0X-21/04 0X Charles SecurityDeposit 1/04/0X DEPOSIT0X-2√$2,300.00 $5,900.00 (A)1/04 0X Charles$600.00 $1,200.00Clark 0X-2 JanRent 1/11/0X Ajax-Plumbing- 101$75.00 $5,825.00 √ 143N. Blvd- Repairs 1/11 0X AjaxPlumbing Repairs101 $75.00$1,125.00 1/20/0X GeraldHoward - 143 N. Blvd102 $465.00$5,360.00 Net Jan Rent to OwnerHoward 1021/20 0X Gerald$465.00 $660.00 NetJan Rent To Owner 1/21/0X YourRealty Company, Inc.$5,245.00103 $115.00 √ 1/0XMgt Fees 1/21 0X YourRealty Co., Inc.103 $60.00$600.00 JanManagement Fee 1/22/0X JackThomas - NSF -DM $2,500.00$2,745.00 √ 1362Main St(B) 1/30/0X PerryMason, Attorney104 $1,000.00$1,745.00 119 Maple Closing 1/31/0X DEPOSIT0X-3 $2,500.00$4,245.00 1/31/0X NCInsured BankDM $25.00$4,220.00 √ Check Printing Charges

(A) - Referenced to sequentially numbered deposit tickets (B) - Debit Memo √-Cleared Bank

SECONDOFTHREE-PARTSERIES.

Rental Trust Account Disbursement Cycle

Following these ﬁve steps will enable you to correctly maintain trust account records of disbursements on rental properties.

If the check pertains to more than one property/owner ledger, prepare a Supplemental Disbursement (Check) Worksheet to detail the property, purpose and amount of the check. This is the basis for an audit trail to the journal and property ledgers.

SUPPLEMENTAL CHECK WORKSHEET YOUR REALTY CO., INC. 1/21/0X - CHECK #103(E) PROPERTY PURPOSEAMOUNT 143 North Boulevard1/0X Management Fees$60.00 2500 Johnson Street1/0X Management Fees$55.00 $115.00 (E) - Date and check number provide cross-reference to corresponding check.

Post the information on the supplemental 4individual property ledger sheets. Calculate disbursement (check) worksheet onto the and record the running balance on each property ledger sheet. NAME: GeraldHoward, Owner - - Clark, TenantACCOUNT NO. ADDRESS:143 North BoulevardNO. SHEET DATE ITEMSDEPOSITS CHECKS BALANCE 1/04 0X CharlesClark 0X-2$600.00 $600.00 SecurityDeposit 1/04 0X CharlesClark 0X-2$600.00 $1,200.00 JanRent 1/11 0X AjaxPlumbing Repairs101 $75.00$1,125.00 1/20 0X GeraldHoward 102$465.00 $660.00 NetJan Rent To Owner 1/21 0X YourRealty Co., Inc.103 $60.00$600.00 JanManagement Fee NAME:Ward, Owner - - Stephens, Tenant AllanACCOUNT NO. ADDRESS:2500 Johnson Street SHEETNO. DATE ITEMSDEPOSITS CHECKS BALANCE 1/04 0X Blake Stephens0X-2 $550.00$550.00 SecurityDeposit 1/04 0X Blake Stephens0X-2 $550.00$1,100.00 JanRent 1/21 0X Your Realty Co., Inc.103 $55.00$1,045.00 Jan Management Fee

Prepare the trust account check. If the check is 1 for one property ledger, record the applicable ledger on the memo line.

Your Realty Company Trust Account Anytown, NC 12345

1/21/0X

00 YourRealty Company, Inc.$115.

00 Onehundred fifteen and/100 ----------------------------Dollars

1/0X Mgt Fees - SCW

6625 54218974932478 5678489745662147

JohnBroker

103

Record the check on the journal. Calculate and 3 record the running journal balance. YOUR REALTY COMPANY, INC. TRUST ACCOUNT JOURNAL NC Insured Bank A/C# 123-456-7890 DATE DESCRIPTIONNUM DEPOSITSCHECKS BALANCE

1/03/0X DEPOSIT0X-1 $3,600.00$3,600.00 √ (A) 1/04/0X DEPOSIT0X-2√$2,300.00 $5,900.00 1/11/0X Ajax-Plumbing- 101$75.00 $5,825.00 √ 143N. Blvd- Repairs 1/20/0X GeraldHoward - 143 N. Blvd102 $465.00$5,360.00 Net Jan Rent to Owner 1/21/0X YourRealty Company, Inc.$5,245.00103 $115.00 √ 1/0XMgt Fees 1/22/0X JackThomas - NSF -DM $2,500.00$2,745.00 √ 1362Main St(B) 1/30/0X PerryMason, Attorney104 $1,000.00$1,745.00 119 Maple Closing 1/31/0X DEPOSIT0X-3 $2,500.00$4,245.00 1/31/0X NCInsured BankDM $25.00$4,220.00 √ Check Printing Charges

(A) - Referenced to sequentially numbered deposit tickets (B) - Debit Memo √-Cleared Bank

Reconcile all the individual property ledgers to the 5 journal (i.e., add up the ending running balances on the ledgers and compare to the ending journal balance for agreement).

NAME:Realty Company, Inc. - Personal Funds YourACCOUNT NO. ADDRESS: SHEETNO. DATE ITEMSDEPOSITS CHECKS BALANCE 1/03 0X YourRealty Company Inc.0X-1 $100.00$100.00 PersonalFunds 1/31 0X NCInsured BankDM $25.00$75.00 Check Printing Charges NAME: Clay(Seller) to Thomas (Buyer)ACCOUNT NO. ADDRESS:1362 Main StreetNO. SHEET DATE ITEMSDEPOSITS CHECKS BALANCE 1/03 0X JackThomas EMD0X-1 $2,500.00$2,500.00 1/22 0X JackThomas NSFDM $2500.00$0.00 1/31 0X JackThomas Redeposit0X-3 $2,500.00$2,500.00 NSFEMD Check

THIRDOFTHREE-PARTSERIES.

Rental Trust Account Monthly Reconciliation

Reconcile the trust account bank statement to the journal and ledgers. Check oﬀ on the journal (see step 4) 1 the checks and deposits that have cleared on the bank statement. NCIB North Carolina Insured Bank Account Number # 1234567890 Statement Period: 1/1/0X1/31/0X Page 1 of 1

Your Realty Co., Inc. Trust Account 132 Main Street Anywhere, NC 27000

WITHDRAWALS Date CheckNo. AmountDate 1/13/0X101 $75.00 1/22/0X103 $115.00* *Indicates a skip in sequential check numbers

1/4/0X 1/5/0X

1/22/0XDM 1/31/0XDM

DEPOSITS $3,600.00 $2,300.00

OTHER DEBITS

$2,500.00 $25.00

Check No.Amount

NonSuffÞcient Funds  Check Returned Printed Check Charges

Closing DatePrevious BalanceDeposits WithdrawalsOther DebitsEnding Balance 1/31/0X$ 00.00$ 5,900.00$ 190.00$ 2,525.00$ 3, 185.00 List t 3 balances on a trial balance. NAME:Realty Company, Inc. - Personal Funds YourACCOUNT NO. ADDRESS: SHEETNO. DATE ITEMSDEPOSITS CHECKS BALANCE 1/03 YourRealty Company Inc.0X-1 $100.00$100.00 PersonalFunds 1/31 0X NCInsured BankDM $25.00$75.00 Check Printing Charges

NAME: Clay(Seller) to Thomas (Buyer)ACCOUNT NO. ADDRESS:1362 Main Street SHEETNO. DATE ITEMSDEPOSITS CHECKS BALANCE 1/03 0X JackThomas EMD0X-1 $2,500.00$2,500.00 1/22 0X JackThomas NSFDM $2500.00$0.00 1/31 0X JackThomas Redeposit0X-3 $2,500.00$2,500.00 NSFEMD Check NAME:Howard, Owner - - Clark, Tenant GeraldACCOUNT NO. ADDRESS:143 North BoulevardNO. SHEET DATE ITEMSDEPOSITS CHECKS BALANCE 1/04 0X CharlesClark 0X-2$600.00 $600.00 SecurityDeposit 1/04 0X CharlesClark 0X-2$600.00 $1,200.00 JanRent 1/11 0X AjaxPlumbing Repairs101 $75.00$1,125.00 1/20 0X GeraldHoward 102$465.00 $660.00 NetJan Rent To Owner 1/21 0X YourRealty Co., Inc.103 $60.00$600.00 JanManagement Fee NAME:Ward, Owner - - Stephens, Tenant AllanACCOUNT NO. ADDRESS:2500 Johnson StreetNO. SHEET DATE ITEMSDEPOSITS CHECKS BALANCE 1/04 0X Blake Stephens0X-2 $550.00$550.00 SecurityDeposit 1/04 0X Blake Stephens0X-2 $550.00$1,100.00 JanRent 1/21 0X Your Realty Co., Inc.103 $55.00$1,045.00 JanManagement Fee

To reconcile the bank statement, add 2 to the ending balance ($3,185) the total of deposits not cleared yet ($2,500) and subtract the total of checks not cleared yet ($1,465). The reconciliation total should equal the journal balance ($4,220).

Bank Account Reconciliation Your Realty Company, Inc.

PeriodEnding:1/31/0X

Ending Balance from Bank Statement

List Deposits in Transit (Depositsposted to the journal thathave not cleared the bank)

Total Deposits in Transit

List Outstanding Checks (Checksposted to the journal thathave not cleareed the bank)

Total Outstanding Checks Reconciled Bank Balance

Check 102 104

Date 1/20/0X 1/20/0X

$ 2,500.00

Amount $ 465.00 $ 1,000.00 $

A.$ 3,185.00

+ B.$ 2,500.00

 C.$ 1,465.00 D.$ 4,220.00

The total of the balances listed on the 4equal the jo ledger sheet trial balance ($4,220) should urnal and the reconciled bank balance. These must equal before you have properly completed a trust account reconciliation in compliance with the Commission’s rules. YOUR REALTY COMPANY, INC. TRUST ACCOUNT JOURNAL NC Insured Bank A/C# 123-456-7890 DATE DESCRIPTIONNUM DEPOSITSCHECKS BALANCE