Question

Natalie decides that she cannot afford to hire John to do her accounting. One way that she can ensure that her cash account does not have any errors and is accurate and up-to-date is to prepare a bank reconciliation at the end of each month.

Natalie would like you to help her. She asks you to prepare a bank reconciliation for June 2019 using the following information.

GENERAL LEDGER—COOKIE CREATIONS
Cash
Date	Explanation	Ref	Debit	Credit	Balance
2019
June 1	Balance				2,657
1			750		3,407
3	Check #600			625	2,782
3	Check #601			95	2,687
8	Check #602			56	2,631
9			1,050		3,681
13	Check #603			425	3,256
20			155		3,411
28	Check #604			297	3,114
28			110		3,224

PREMIER BANK Statement of Account—Cookie Creations June 30, 2019
Date		Explanation		Checks and Other Debits			Deposits		Balance
May 31		Balance							3,256
June 1		Deposit					750		4,006
6		Check #600		625					3,381
6		Check #601		95					3,286
8		Check #602		56					3,230
9		Deposit					1,050		4,280
10		NSF check		100					4,180
10		NSF–fee		35					4,145
14		Check #603		452					3,693
20		Deposit					125		3,818
23		EFT–Telus		85					3,733
28		Check #599		361					3,372
30		Bank charges		13					3,359

Additional information:

1.		On May 31, there were two outstanding checks: #595 for $238 and #599 for $361.
2.		Premier Bank made a posting error to the bank statement: check #603 was issued for $425, not $452.
3.		The deposit made on June 20 was for $125 that Natalie received for teaching a class. Natalie made an error in recording this transaction.
4.		The electronic funds transfer (EFT) was for Natalie’s utilities expense.
5.		The NSF check was from Ron Black. Natalie received this check for teaching a class to Ron’s children. Natalie contacted Ron, and he assured her that she will receive a check in the mail for the outstanding amount of the invoice and the NSF bank charge.

The NSF fee will be charged to the customer.

Prepare Cookie Creations’ bank reconciliation for June 30.

Prepare any necessary adjusting entries at June 30.

If a balance sheet is prepared for Cookie Creations at June 30, what balance will be reported as cash in the current assets section?

If a balance sheet were prepared, cash at June 30th, 2019 would be $

Answer 1

Solution ::

	Bank Reconcilaition
	Unadjusted Balance as per Bank on June 30		$3,359
	Add: Deposits in Transit	110
	Add: Error made by bank in recording check	27	137
	Less:
	Outstanding checks
	Check No. 595	238
	Check no. 604	297	535
	adjusted Balance as per Bank on June 30		$2,961
	Unadjusted Balance as per Books on June 30		3224
	Less: error made on recording deposit transaction
	(155-125)	30
	NSF check	100
	NSF Fees	35
	EFT-Telus	85
	Bank Charges	13	263
	adjusted Balance as per Books on June 30		2961
	Accounts Title	Dr	Cr
30-Jun	Miscelleneous Expenses/Bank service charges	$13
	Cash		$13
	Service Revenue	30
	Cash		30
	Utilities expenses	85
	Cash		85
	Accounts Receivable (100+35)	135
	Cash		135
ans	Cash at June 30 Thank you:::;	2961