Question

Jones Company shows the following data :

Balance per cash account $3260

Balance per bank statement 3908

Outstanding checks 1400

Deposits in transit 3972

Bank service charge 75

Note collected ($340 is interest) 3340

NSF check 225

Error in recording computer supplies ; the amount of the check is $350, but it was recorded as $530

Required ; Please prepare a bank reconciliation as of 12/31/18.

Please record any necessary journal entries.

Answer 1

SOLUTION

1. Bank reconciliation statement-

Particulars	Amount ($)	Particulars	Amount ($)
Balance per bank statement	3,908	Balance as per books	3,260
Add: Deposit in transit	3,972	Add: Notes collected	3,340
	7,880	Error recorded (530-350)	180
Less: Outstanding checks	(1,400)		6,780
		Less: Bank service charges	(75)
		NSF checks	(225)
Adjusted bank balance	6,480	Adjusted book balance	6,480

2. Journal entries-

S.No.	Accounts titles and Explanation	Debit ($)	Credit ($)
1.	Cash	3,340
	Notes receivable		3,000
	Interest revenue		340
2.	Cash	180
	Sales		180
3.	Accounts receivable	225
	Cash		225
4.	Bank service charges	75
	Cash		75