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EA8. LO 8.6 Prepare the journal entry to reconcile the bank statement in Exercise 8.7 EA9. LO 8.6 Using the following informa
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Answer #1

The bank reconciliation statement is shown as follows:- (Amounts in $)

Bank Balance 4,587
Add: Deposits in Transit 1,546
6,133
Less: Outstanding Checks 956
Adjusted Bank Balance 5,177
Book Balance 5,577
Add: Interest Income 56
5,633
Less: NSF Check 456
Adjusted Book balance 5,177

Notes:-

1) Deposits in transit and outstanding checks are already adjusted in books therefore adjusted from bank balance for calculating adjusted bank balance.

2) Interest income is not credited in books therefore credited in cash and NSF check is the check returned due to non sufficient funds. (received from accounts receivable)

Journal Entry to reconcile the bank statement is shown as follows:- (Amounts in $)

No Account Titles Debit Credit
1 Cash 56
Interest Income 56
(To record the interest income)
2 Accounts Receivable 456
Cash 456
(To record the NSF check)
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