Required: Prepare a bank reconciliation to the correct balance in cash.
Prepare any necessary journal entries for Jack Company.
Use the following information to prepare a bank reconciliation for Jack Company at April 30, 2016:
Cash account balance, April 30, $19,572.80.
Bank statement balance, April 30, $21,516.40.
Service charge on bank statement not recorded in books, $140.00.
Deposits in transit, $2,877.20.
Outstanding checks, April 30, $1,893.60.
The bank statement included a charge of $932.80 for A. Parish’s NSF check. The check, returned with the bank statement, had been received by Jack in payment on account.
The bank collected a $4,000.00 note in April for Jack. This amount was included in the bank statement, but Jack had not yet recorded the collection. The bank’s $140.00 service charge for April [see (3) above] included collection charge for the note.
Bank Reconciliation Statement: | ||||||||
Balance as per Bank Statement | 21516.4 | Balance as per Books | 19572.8 | |||||
Addtions: | Additions: | |||||||
Deposits in transit | 2877.2 | Collection of Notes receivable | 4000 | |||||
Subtotals | 24393.6 | Subtotals | 23572.8 | |||||
Deductions: | Deductions: | |||||||
Outstanding checks | 1893.6 | Service charges | 140 | |||||
NSF check | 932.8 | |||||||
Adjusted balance as per bank statement | 22500 | Adjusted balance as per Books | 22500 | |||||
Journal entries: | ||||||||
Acounts title and explanations | Debit $ | Credit $ | ||||||
Cash account Dr. | 4000 | |||||||
Notes receivable | 4000 | |||||||
Misc. expense Account Dr. | 140 | |||||||
Cash account | 140 | |||||||
Accounts receivable Account Dr. | 932.8 | |||||||
Cash account | 932.8 | |||||||
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