when reading a bank statement,which reference indicates an increase in the cash balance?
1. Debit Memorandum
2. Credit Memorandum
3. NSF check
4. Service Charge
when reading a bank statement,which reference indicates an increase in the cash balance?
1. Debit Memorandum
2. Credit Memorandum
3. NSF check
4. Service Charge
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Bank Reconciliation The Chicago Scooter Company's bank statement for the month of June indicated a balance of $3,350. The company's cash account in the general ledger showed a balance of $2,464 on June 30. Other relevant information includes the following:
Deposits in transit on June 30 total $2,550.
The bank statement shows a debit memorandum for a $10 check printing charge.
Check No. 160 payable to Simon Company was recorded in the accounting records for $124 and cleared the bank for this same amount. A review of the records indicated that the Simon account now has an $18 credit balance and the check to them should have been $142.
Outstanding checks as of June 30 totaled $3,100.
Check No. 176 was correctly written and paid by the bank for $203. The check was recorded in the accounting records as a debit to accounts payable and a credit to cash for $230.
The bank returned a NSF check in the amount of $311.
The bank included a credit memorandum for $630 representing a collection of a customer's note. The principle portion was $610 and the interest portion was $20. The interest had not been accrued.
Required
a. Prepare the June bank reconciliation for Chicago Scooter Company.
b. Prepare any necessary adjusting entries.
a.
| CHICAGO SCOOTER COMPANY Bank Reconciliation June 30 | |||
|---|---|---|---|
| Cash Balance per Bank | $Answer | ||
| Add: | AnswerReconciled Cash Balance per BankReconciled Cash Balance per BooksCollection of NoteDeposit in TransitNSF CheckOutstanding ChecksCheck Printing Charge | Answer | |
| Less: | AnswerReconciled Cash Balance per BankReconciled Cash Balance per BooksCollection of NoteDeposit in TransitNSF CheckOutstanding ChecksCheck Printing Charge | Answer | |
| AnswerReconciled Cash Balance per BankReconciled Cash Balance per BooksCollection of NoteDeposit in TransitNSF CheckOutstanding ChecksCheck Printing Charge | $Answer | ||
| Cash Balance per Books | $Answer | ||
| Add: | Accounts Payable Error | $Answer | |
| Add: | AnswerReconciled Cash Balance per BankReconciled Cash Balance per BooksCollection of NoteDeposit in TransitNSF CheckOutstanding ChecksCheck Printing Charge | Answer | Answer |
| Less: | AnswerReconciled Cash Balance per BankReconciled Cash Balance per BooksCollection of NoteDeposit in TransitNSF CheckOutstanding ChecksCheck Printing Charge | Answer | |
| Less: | NSF Check | Answer | Answer |
| AnswerReconciled Cash Balance per BankReconciled Cash Balance per BooksCollection of NoteDeposit in TransitNSF CheckOutstanding ChecksCheck Printing Charge | $Answer | ||
b.
| GENERAL JOURNAL | ||||
|---|---|---|---|---|
| Date | Description | Debit | Credit | |
| June | 30 | AnswerAccounts PayableAccounts ReceivableCashInterest EarnedMiscellaneous ExpenseNotes Receivable | $Answer | $Answer |
| AnswerAccounts PayableAccounts ReceivableCashInterest EarnedMiscellaneous ExpenseNotes Receivable | Answer | Answer | ||
| To correct check error in recording check No. 176. | ||||
| 30 | AnswerAccounts PayableAccounts ReceivableCashInterest EarnedMiscellaneous ExpenseNotes Receivable | Answer | Answer | |
| AnswerAccounts PayableAccounts ReceivableCashInterest EarnedMiscellaneous ExpenseNotes Receivable | Answer | Answer | ||
| Interest Earned | Answer | Answer | ||
| To record note collection by bank. | ||||
| 30 | AnswerAccounts PayableAccounts ReceivableCashInterest EarnedMiscellaneous ExpenseNotes Receivable | Answer | Answer | |
| AnswerAccounts PayableAccounts ReceivableCashInterest EarnedMiscellaneous ExpenseNotes Receivable | Answer | Answer | ||
| To record check printing charge. | ||||
| 30 | AnswerAccounts PayableAccounts ReceivableCashInterest EarnedMiscellaneous ExpenseNotes Receivable | Answer | Answer | |
| AnswerAccounts PayableAccounts ReceivableCashInterest EarnedMiscellaneous ExpenseNotes Receivable | Answer | Answer | ||
| To record NSF check. | ||||
| 10 points | |||
| Using the code letters below, indicate howeach of the items listed would be handled in preparing a bankreconciliation. Enter the appropriate code letter in the space tothe left of each item. | ||||
| Code | ||||
| A | Add to cash balance per books | |||
| B | Deduct from cash balance per books | |||
| C | Add to cash balance per bank | |||
| D | Deduct from cash balance per bank | |||
| E | Does not affect the bank reconciliation | |||
| Items: | ||||
| 1 | Outstanding checks. | |||
| 2 | Bank service charge. | |||
| 3 | Check for $420 correctly written and paidby the bank but incorrectly entered in the cash payments journalfor $240. | |||
| 4 | Deposit in transit. | |||
| 5 | Bank returns deposited check marked NSF. | |||
| 6 | Bank collects notes receivable and interest for depositor. | |||
| 7 | Bank debit memorandum for check printing fees. | |||
| 8 | Petty cash custodian has $91 in paid pettycash vouchers that have not been reimbursed. | |||
| 9 | Bank charged a check against the companywhich should have been charged to another company. | |||
| 10 | A check for $246 was correctly paid by thebank but was incorrectly entered in the cash payments journal for$264. | |||
