Question

Sage Hill Inc.'s bank statement from Main Street Bank at August 31, 2022, gives the following information. Balance, August 1 $18,635 Bank debit memorandum: August deposits 71,235 Safety deposit box fee $ 40 Checks cleared in August 68,663 Service charge 65 Bank credit memorandum: Balance, August 31 21,162 Interest earned 60 A summary of the Cash account in the ledger for August shows the following: balance, August 1, $18,935; receipts $74,235; disbursements $73,555; and balance, August 31, $19,615. Analysis reveals that the only reconciling items on the July 31 bank reconciliation were a deposit in transit for $4,815 and outstanding checks of $4,515. In addition, you determine that there was an error involving a company check drawn in August: A check for $400 to a creditor on account that cleared the bank in August was journalized and posted for $40. (a) Your answer is correct. Determine deposits in transit. Deposits in transit $ 7,815 eTextbook and Media List of Accounts Attempts: 4 of 6 used

Answer 1

SAGE HILL INC.
Bank Reconciliation
Aug-31
Bank balance		21,162
Add: Deposit in transit		7,815
Deposit in transit		28,977
Less:Outstanding checks		-9,767
Adjusted cash balance		$19,210
Cash balance		19,615
Add: Interest earned		60
		19,675
Less:
Safety deposit box fee	-40
Service charge	-65
Correction of book error	-360
		-465
Adjusted cash balance		$19,210

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