Question

wir work) Prob#3: Use the following Information to Answer the Questions Below using a Bank Reconciliation A. Assume Any Differences Found are Errors made by the Bank B. Items included on the Books (General Ledger) of the JW-Corp For May were as follows: 1. Ending GL Cash Balance at May 31st was $53,000 2. Deposits made During the month were on May 22nd=$11,000, May 28th $29,000, and May 30th=$30,000. 3. Checks written from our GL account were #302=$12,000, #303=$13,000, #304=$5,000, #305=$14,000 C. Items Included on the Charles Schwab Bank Statement for May were as follows; 1. Ending Bank Balance at May 31-st was $31,000. 02. Interest Earned was $3,000 3. Monthly Bank Fees of $2,000 4. Collection by the Bank from Our Customer S.Curry on Account for $26,000 5. Non-Sufficient Funds (NSF) Check from Our Customer L.James on Account for $9,000 6. Deposits recorded by the bank included the following: May 28-th=$29,000. 7. Checks that were paid and cleared by the bank during May were; #302=$12,000, #303=$31,000. 1) Compute the Ending Adjusted Cash Balance as of May 31st = 2) Compute the Total of All Outstanding Checks at May 31st = TE VOM 3) Compute the Total of All Deposits in Transit at May 31st = Compute the Total NET CASH Adjustment Required , +/(-) = to UPDATE the Cash Account Balance in our GL.

Answer 1

1) The ending Adjusted cash Balance as of May 31 st

Interest Earned $3000 - Monthly Bank Fees $2000 + Collection by the bank from customer $26000 = $ 27000

2) Total of outstanding Checks at May 31 st

Check Issued during the month #302, #303, #304, #305 out of which #302 and #303 Were Cleared. But Check number #303 wrongly entered by bank as $31000 instead of $13000. Remaining outstanding checks are #304( $5000) + #305( $14000) = $19000

3) All deposits in transit at May 31st

During the month $11000, $29000 and $30000 deposits were made out of bank recorded only $29000. So remaining are deposits in transit $11000+$30000 = $ 41000

4)Net cash adjustment

$27000 + $19000 - $41000 -$9000 ( In sufficient check from customer) = -$4000