Question

Bank Reconciliation

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

Chesner Co.
Bank Reconciliation
July 31, 20Y4
Cash balance according to company's records			$6,170
Adjustments:
Outstanding checks	$2,960
Error by Chesner Co. in recording Check
No. 1056 as $710 instead of $170	540
Note for $9,700 collected by bank, including interest	10,090
Deposit in transit on July 31	(6,280)
Bank service charges	(30)
Total adjustments			7,280
Cash balance according to bank statement			$13,450

a. From the data in this bank reconciliation, prepare a new bank reconciliation for Chesner Co., use the format shown in the Let’s Review section. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Chesner Co.
Bank Reconciliation
July 31, 20Y4
Cash balance according to bank statement		$
Add: Deposit in transit on July 31
Deduct: Outstanding checks
Adjusted balance		$
Cash balance according to company's records		$
Add: Error in recording Check No. 1056 as $710 instead of $170	$
Add: Note for $9,700 collected by bank, including interest
Total additions
Deduct: Bank service charges
Adjusted balance		$

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b. If a balance sheet were prepared for Chesner Co. on July 31, 20Y4, what amount should be reported for cash?
$

Answer 1

		Bank Reconciliation
		July 31,2014
a)	Cash balance according to bank statement							13,450
	AddL Deposit in transit on July 31							6,280
	Deduct:outstanding checks							-2,960
	Adjusted balance							16,770
	Cash balance according to company's records							6,170
	Add:Error in recording check No 1056 as 710 instead of $170						540
	Add:Note for $9700 collected by bank including interest						10,090
	total addittions							10,630
	Deduct :Bank service charge							-30
	Adjusted balance							16,770
b)	16,770