Question

The following data were gathered to use in reconciling the bank account of torres company:

Balance per bank $12,175
Balance per comany records 9,480
Bank service charges 50
Deposit in transit 1,800
NSF check 1,250
Outstanding checks 5,795

a. What is the adjusted balance on the bank reconcilitation?
b. Journalize any necessary entries for Torres Company based on the bank reconcilitation.

Answer 1

a.

Balance as per Bank Statement	$   12,175
Add: Deposit in transit	$     1,800
Less: Outstanding Checks	$   (5,795)
Adjusted Bank Balance	$     8,180

Balance as per books	$     9,480
Less : NSF Check	$   (1,250)
Less: Bank Service Charge	$         (50)
Adjusted Book Balance	$     8,180

b.

Debit Bank Service Charges $ 50
Credit Cash $ 50

Debit Accounts Receivable $ 1,250
Credit Cash $ 1,250