Question

Bank Reconciliation and Entries The cash account for All American Sports Co. on April 1, 2015, indicated a balance of $23,600. During April, the total cash deposited was $80,150, and checks written totaled $72,800. The bank statement indicated a balance of $40,360 on April 30, 2015. Comparing the bank statement, the canceled checks, and the accompanying memes with the records revealed the following reconciling items: a. Checks outstanding totaled $14,300. b. A deposit of $9,275, representing receipts of April 30, had been made too late to appear on the bank statement c. A check for $720 had been incorrectly charged by the bank as $270. d. A check for $110 returned with the statement had been recorded by All American Sports Co as $1,100. The check was for the payment of an obligation to Garber Co. on account. e. The bank had collected for All American Sports Co. $4,320 on a note left for collection. The face of the note was $4,000. 1. Bank service charges for April amounted to $75. 9. A check for $1,300 from Bishop Co. was returned by the bank because of insufficient funds. Instructions: 1. Prepare a bank reconciliation as of April 30. All American Sports Co. Bank Reconciliation April 30, 2015 Cash balance per bank statement Add: Deposit of April 30. not recorded by bank Deduct: Outstanding checks Deduct: Bankerror in charging check as $270 Instead of 5720 450 14.750

Answer 1

Solution:

Increase in cash
Statement of Cash Flows	Balance Sheet								Income Statement
	Assets			=	Liabilities	+	Stockholders' Equity
	Cash	+	Note Receivable	=	Accounts Payable	+		Retained earnings
	5310		-4000		990			320
Statement of Cash Flows								Income Statement
Operating	5310							Interest Revenue	320
								No effect	0
								No effect	0

Decrease in cash
Statement of Cash Flows	Balance Sheet								Income Statement
	Assets			=	Liabilities	+	Stockholders' Equity
	Cash	+	Accounts Receivable	=	No effect	+		Retained earnings
	-1375		1300		0			-75
Statement of Cash Flows								Income Statement
Operating	-1375							Miscellaneous adm. Expense	-75
								No effect	0
								No effect	0