Question

Chicago Company has hired you to reconcile its bank statement and cash account. At June 30,...

Chicago Company has hired you to reconcile its bank statement and cash account. At June 30, 2019, the Cash account on the books showed the following:

Cash account

Date

Explanation

Debits

Credits

Balance

June 1

Balance

$5,600

June 1-30

Deposits

$32,000

37,600

June 1-30

Checks

$29,700

7,900

June 30

Balance

7,900

The June bank statement, just received, showed the following:

June 1, balance

$5,600

Deposits made in June

29,000

Interest paid by the bank in June

120

Checks paid in June

(27,500)

Bank service charge for June

(50)

NSF Charged (Brad Jolie, check returned for nonsufficient funds)

(150)

June 30, balance

$7,020

There were neither outstanding checks nor deposits in transit at May 31, 2019.

A. Prepare the bank reconciliation at June 30, 2019.

B. Prepare the adjusting journal entries needed as a result of preparing the bank reconciliation.

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