Question

Bank Reconciliation

An accounting clerk for Chesner Co. prepared the following bank reconciliation:

Chesner Co.
Bank Reconciliation
August 31
Cash balance according to company's records			$8,230
Add: Outstanding checks	$3,950
Error by Chesner Co. in recording Check
No. 1056 as $710 instead of $170	540
Note for $12,900 collected by bank, including interest	13,420		17,910
			$26,140
Deduct: Deposit in transit on August 31	$8,380
Bank service charges	60		8,440
Cash balance according to bank statement			$17,700

a. From the data in this bank reconciliation, prepare a new bank reconciliation for Chesner Co., using the format shown in the illustrative problem.

Chesner Co.
Bank Reconciliation
August 31
Cash balance according to bank statement		$
Adjusted balance		$
Cash balance according to company's records		$
	$
Adjusted balance		$

b. If a balance sheet were prepared for Muskegon Co. on May 31, 2016, what amount should be reported for cash?
$

Answer 1

i)	Chesner Co
	Bank Reconciliation Statement
	Month Ended August 31
	Cash Balance as per bank statement	17700
	Add: Deposit in Transit	8380
	Less: Outstanding checks	-3950
	Adjusted Cash Balance	22130
	Cash balance as per books	8230
	Add: Note Collected	13420
	Add: Error rectification	540
	Less: Bank Service charges	-60
	Adjusted Cash Balance	22130
II)	If a balance sheet were prepared, Amount should be reported for Cash $22130