Question

Required information

[The following information applies to the questions displayed below.]

The following information is available to reconcile 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 $24,906 debit balance, but its July bank statement shows a $27,589 cash balance.

2. Check No. 3031 for $1,640, Check No. 3065 for $596, and Check No. 3069 for $2,408 are outstanding checks as of July 31.

3. Check No. 3056 for July rent expense was correctly written and drawn for $1,270 but was erroneously entered in the accounting records as $1,260.

4. The July bank statement shows the bank collected $9,500 cash on a note for Branch. 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. Branch has not yet recorded this check as NSF.

6. 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.

7. Branch’s July 31 daily cash receipts of $10,632 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. BRANCH COMPANY Bank Reconciliation July 31 Book balance Add: Bank statement balance Add: Deduct: Deduct: Adjusted bank balance $ 0 Adjusted book balance

Answer 1

BRANCH COMPANY Bank Reconciliation July 31 Bank statement balance 27,589 Book balance 24,906 Add: Add: Deposit in transit 10,632 Bank collection of note receivable 9,500 10,632 9,500 Deduct: Deduct: Outstanding check Bank service charges 14 3031 1,640 NSF Check 805 3065 596 Correction of book error 10 3069 2,408 -829 -4,644 Adjusted bank balance $33,577 Adjusted book balance $33,577

Kindly give a positive rating if you are satisfied with this solution and please ask if you have any query.

Thanks