Question

 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.

 a. On July 31, the company's Cash account has a $25,644 debit balance, but its July bank statement shows a $26,809 cash balance.

 b. Check No. 3031 for $1,060 and Check No. 3040 for $522 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 $306 and Check No. 3069 for $1,828, both written in July, are not among the canceled checks on the July 31 statement.

 c. 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 $1,280 but was erroneously entered in the accounting records as $1,270.

 d. The July bank statement shows the bank collected $9,500 cash on a noninterest-bearing note for Branch, deducted a $48 collection expense, and credited the remainder to its account. Branch had not recorded this event before receiving the statement.

 e. 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.

 f. The July statement shows a $14 bank service charge. It has not yet been recorded in miscellaneous expenses because no previous notification had been received.

 g. Branch's July 31 daily cash receipts of $10,652 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.

Answer 1

				Bank Reconciliation
Bank Statement balance				26,809	Book Balance					25,644
Add					Add:
Deposit of July 31			10,652		Proceeds of note less collection charge				9452
				10,652						9,452
				37,461						35,096
Deduct:					Deduct:
check no 3031			1,060		NSF Check				805
check no 3065			306		Service Charge				14
check no 3069			1,828		Error (Check 3056)				10
				3,194						829
Adjusted bank balance				34,267						34,267
			Journal Entries
	Date	General Journal					Debit	Credit
	uly 31	Cash					9,452
		Collection expense					48
		Note receivable						9,500
		(being note collected)
	31-Jul	Account receivable-shaw					805
		cash						805
		(being NSF)
	31-Jul	Miscellaneous expense					14
		cash						14
		(being service charge)
	31-Jul	Rent expense					10
		cash						10
		(beig error rectified)
		no entry for outstanding checks
		no entry for deposit