Question

Claybon Company deposits all cash receipts on the day they are received and makes all cash payments by check. At the close of business on May 31, its Cash account shows a debit balance of $20,025. Claybom's May bank statement shows $18.200 on deposit in the bank Determine the adjusted cash balance using the following information: Deposit in transit Outstanding checks Bank service fees, not yet recorded by company A NSF check from a customer, not yet recorded by the company $6,100 $5,200 $ 55 $ 870 The adjusted cash balance should be

Answer 1

The adjusted cash balance

The adjusted cash balance = Debit balance in the cash account – Bank service fees not yet recorded – NSF check from a customer not yet recorded

= $20,025 - $55 - $870

= $19,100

“Hence, the adjusted cash balance will be $19,100”