Question

The following information is available for Pyle Garage for March 2018:

BANK STATEMENT HAZARD STATE BANK 215 MAIN STREET HAZARD, GA 30321
Pyle Garage 629 Main Street HAZARD, GA 30321						Account number 62-00062 March 31, 2018
Beginning balance 3/1/2018						$9,037
Total deposits and other credits						29,873
Total checks and other debits						24,693
Ending balance 3/31/2018						14,217
	Checks and Debits					Deposits and Credits
	Check No.		Amount			Date		Amount
		1462	$	3,767		March	1	$	1,111
		1463		1,656		March	2		6,510
		1464		8,007		March	6		4,939
		1465		2,905		March	12		6,182
		1466		1,411		March	17		5,973
		1467		6,193		March	22		2,097
		DM		24		CM			3,061
		1468		730

   

The following is a list of checks and deposits recorded on the books of Pyle Garage for March 2018:

Date			Check No.	Amount of Check			Date			Amount of Deposit
March	1		1463	$	1,656		March	1		$	6,510
March	5		1464		8,007		March	5			4,939
March	6		1465		2,905
March	9		1466		1,411		March	10			6,182
March	10		1467		6,193
March	14		1468		85		March	16			5,973
March	19		1469		1,511		March	19			2,097
March	28		1470		756		March	29			3,559

Other Information

1. Check no. 1462 was outstanding from February.

2. A credit memo for collection of accounts receivable was included in the bank statement.

3. All checks were paid at the correct amount.

4. The bank statement included a debit memo for service charges.

5. The February 28 bank reconciliation showed a deposit in transit of $1,111.

6. Check no. 1468 was for the purchase of equipment.

7. The unadjusted Cash account balance at March 31 was $13,117.

Required:

1. Prepare the bank reconciliation for Pyle Garage at the end of March.

2. How the adjustments described above affect the cash account.

Prepare the bank reconciliation for Pyle Garage at the end of March.

PYLE GARAGE
Bank Reconciliation
March 31, 2018
Unadjusted Bank Balance, March 31, 2018		not attempted
not attempted		not attempted
not attempted	not attempted
not attempted	not attempted
not attempted	not attempted	0
True Cash Balance, March 31, 2018		$0
Unadjusted Book Balance, March 31, 2018		not attempted
not attempted		not attempted
not attempted	not attempted
not attempted	not attempted	0
True Cash Balance, March 31, 2018		$0

How the adjustments described above affect the cash account. (Select "Not affected" if there is no affect on the "Cash account".)

Item No.	Affect on the Cash Account
1.	not attempted
2.	not attempted
3.	not attempted
4.	not attempted
5.	not attempted
6.

Answer 1

Solution 1:

Hazard State Bank
Bank Reconciliation Statement
For the month of march
Particulars		Amount
Balance on bank statement		$14,217.00
Additions:
Outstanding Deposits	$3,559.00
Total Additions		$3,559.00
		$17,776.00
Deductions:
Outstanding checks	$2,267.00
Total Deductions		$2,267.00
Adjusted bank balance		$15,509.00
Balance in books		$13,117.00
Additions:
Collection of Accounts receivables	$3,061.00
Total Additons		$3,061.00
		$16,178.00
Deductions:
Service Charge	$24.00
Incorrect recording of check 1468	$645.00
Total Deductions		$669.00
Adjusted book balance		$15,509.00

Solution 2:

1. Not affected

2. Increase the cash balance

3. Decrease the cash balance

4. Decrease the cash balance

5. Not affected

6. Not affected.