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The following data were accumulated for use in reconciling the bank account of Mathers Co. for July:

1.Cash balance according to the company’s records at July 31, $32,110.

2. Cash balance according to the bank statement on July 31, $31,350.

3. Checks outstanding, $2,870.

4. Deposit in transit, not recorded by bank, $4,150.

5. A check for $170 in payment of an account was erroneously recorded in the check register as $710.

6. Bank debit memo for service charges, $20.

Required:

a. Prepare a bank reconciliation
b. If the balance sheet is prepared for Mathers Co. on July 31, what amount should be reported for cash?
c. Must a bank reconciliation always balance (reconcile)?

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Romarie Khazandra Marijuan
Romarie Khazandra MarijuanLv10
27 Jan 2021

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Related questions

The following data were accumulated for use in reconciling thebank account of Creative Design Co. for August 20Y6:

1. Cash balance according to thecompany’s records at August 31, $20,870.
2. Cash balance according to the bankstatement at August 31, $37,600.
3. Checks outstanding, $23,375.
4. Deposit in transit not recorded bybank, $7,500.
5. A check for $100 in payment of anaccount was erroneously recorded in the check register as$1,000.
6. Bank debit memo for servicecharges, $45.
A. Prepare a bank reconciliation,using the format shown in

Exhibit 13

. Refer to the Amount Descriptions list provided for the exactwording of the answer choices for text entries. For those boxes inwhich you must enter subtracted or negative numbers use a minussign.
B. If the balance sheet wereprepared for Creative Design Co. on August 31 what amount should bereported for cash?
C.

Must a bank reconciliation always balance(reconcile)?

AmountDescriptions
Adjusted balance
Bank service charge
Bank error in charging check as$100 instead of $1,000
Bank error in charging check as$1,000 instead of $100
Deposit in transit, not recorded bybank
Error in recording check as $100instead of $1,000
Error in recording check as $1,000instead of $100
Outstanding checks

Total adjustments

The following information is available to reconcile the Branch Company’s book balance of cash with its bank statement cash balance as of July 31.

  

  1. On July 31, the company’s Cash account has a $25,457 debit balance, but its July bank statement shows a $28,096 cash balance.
  2. Check No. 3031 for $1,620, Check No. 3065 for $586, and Check No. 3069 for $2,388 are outstanding checks as of July 31.
  3. Check No. 3056 for July rent expense was correctly written and drawn for $1,260 but was erroneously entered in the accounting records as $1,250.
  4. The July bank statement shows the bank collected $5,000 cash on a note for Branch. The branch had not recorded this event before receiving the statement.
  5. The bank statement shows an $805 NSF check. The check had been received from a customer, Evan Shaw. The branch has not yet recorded this check as NSF.
  6. The July statement shows a $8 bank service charge. It has not yet been recorded in miscellaneous expenses because no previous notification had been received.
  7. Branch’s July 31 daily cash receipts of $6,132 were placed in the bank’s night depository on that date but do not appear on the July 31 bank statement.

2. Prepare the journal entries necessary to make the company’s book balance of cash equal to the reconciled cash balance as of July 31. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

The following information is available to reconcile Branch Company’s book balance of cash with its bank statement cash balance as of July 31, 2017.

On July 31, the company’s Cash account has a $24,754 debit balance, but its July bank statement shows a $27,067 cash balance.

Check No. 3031 for $1,510 and Check No. 3040 for $747 were outstanding on the June 30 bank reconciliation. Check No. 3040 is listed with the July canceled checks, but Check No. 3031 is not. Also, Check No. 3065 for $531 and Check No. 3069 for $2,278, both written in July, are not among the canceled checks on the July 31 statement.

In comparing the canceled checks on the bank statement with the entries in the accounting records, it is found that Check No. 3056 for July rent expense was correctly written and drawn for $1,260 but was erroneously entered in the accounting records as $1,250.

The July bank statement shows the bank collected $6,000 cash on a noninterest-bearing note for Branch, deducted a $30 collection expense, and credited the remainder to its account. Branch had not recorded this event before receiving the statement.

The bank statement shows an $805 charge for a $795 NSF check plus a $10 NSF charge. The check had been received from a customer, Evan Shaw. Branch has not yet recorded this check as NSF.

The July statement shows a $9 bank service charge. It has not yet been recorded in miscellaneous expenses because no previous notification had been received.

Branch’s July 31 daily cash receipts of $7,152 were placed in the bank’s night depository on that date but do not appear on the July 31 bank statement.

Required:

1. Prepare the bank reconciliation for this company as of July 31, 2017.

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