Question

O AU TIL (25') The December cash record of Fort Imports and Exports Co. follows: Cash Receipts Date - Cash Payments Cash Debit Date Check Cash Credit No. Dec 5 $ 2,260 Dec 5 $ 2,735 4,718 305 3,190 306 150 1,004 307 3,266 Total S 11,172 309 175 310 2.400 Total $9,128 12 304 23 402 306 105 280- 28- 31 175 ABB Insurance's cash account shows a balance of $5,657 at December 31. On December 31, 2017 the company received the following bank statement: Bank Statement for December Beginning Balance S4,261 Cheques Cleared Other Bank Account Transactions Dec. 1 286 $ 217 Dec. 8 Deposit $ 2,620+ 305 402 Deposit 4,718+ Deposit 3,190+ 1,648 NSF 289 326 Service Charge 304 2,735 Interest 12+ 309 Total $5,608 Ending Balance 88,885 Notes: BC-bank collection; EFT-electronic funds transfer, NSF-nonsufficient funds check SC-service charge Additional data for the bank reconciliation follows: On November 30, 2017 bank reconciliation for the company, there were three outstanding checks:286 for $217, #289 for 326, and #290 for $105. There were no deposits in transit as at November 30, 2017 The bank balance at November 30, 2017 was $4,261. The Adjusted cash balance was $3,613. b. The NSF cheque was originally received from NSF cheque was originally received from a customer, R. Siddi, in payment of his account of $265. The bank included a $15 service charge for a total of $280. c. Investigation reveals that cheque #300 Was gation reveals that cheque #306 was issued to pay the telephone bill and cheque #308 was issued to pay rent. d. All deposits are for collections of accounts receivable.

Answer 1

$360 $45 Bank Reconciliation is a process of identifying the difference that exist between the company's bank balance as per bank statement supplied by bank and cash balance as per company's accounting records. Fort Imports and exports Co Bank Reconciliation 31st Dec 2017 Particulars Amount Amount Journal Entry Bank Balance Dec, 31 $8,885 Sr.No Date Particulars Debit Credit Add: 1 31st Dec 2017 Cash $360 Deposit in Transit $1,004 $1,004 Accounts Receivable $9,889 (To record accounts receivable collection) Deduct: 1 31st Dec 2017 Cash $12 Outstanding Check # 290 $105 Interest Income $12 Outstanding Check # 310 $2,400 (To record interest income) Outstanding Check # 307 $3,266 2 31st Dec 2017 Cash Total Deduction ($5,771) Utilities Expense $45 Adjusted Bank Balance $4,118 (To record rectification entry) Cash 3 31st Dec 2017 Accounts Receivable $280 Balance Dec, 31 $5,657 Cash $280 (To record rent payment) Collection of Accounts Receivable ($2620-$2260] $360 4 31st Dec 2017 Rent Expense $1,648 Interest $12 Cash $1,648 Error in posting ($150 - $105] $45 $417 (To record rent payment) $6,074 5 31st Dec 2017 Bank Charges $28 Deduct: Cash $28 NSF Check including charges $280 (To Record bank service charges) Rent Payment $1,648 Note: NO journal entry is required for Deposit in transit and Outstanding checks. Bank Service Charge $28 Total Deduction ($1,956) Adjusted Book Balance $4,118 Add: