Question

DMC Company had checks outstanding totaling $18,200 on its June bank reconciliation. In July, DMC Company issued checks totaling $78,900. The July bank statement shows that $71,400 in checks cleared the bank in July. A check from one of DMC Company's customers in the amount of $2,200 was also returned marked "NSF." The amount of outstanding checks on DMC Company's July bank reconciliation should be

a.   $7,500.

b.   $23,500.

c.   $25,700.

d.   $27,900.

KLM Company had the following reconciling information in preparing its bank reconciliation:

Cash balance per bank, 9/30                                          $27,000

Note receivable collected by bank                                   12,800

Outstanding checks                                                          14,000

Deposits in transit                                                              6,000

Bank service charge                                                              350

NSF check                                                                         3,900

           Determine the cash balance per books (before adjustments) for KLM Company.

a.   $19,000.

b.   $9,450.

c.   $10,450.

d.   $8,450.

Answer 1