Question

Question 4 From the following information for the Dolce & Gabana Company, prepare: a) A Bank Reconciliation statement on November 30, 2019. b) The necessary general journal entries to correct the accounts of the company. Information for Dolce & Gabana: 1) The cash ledger account had a balance of $7,730 on November 30, 2019. 2) The bank statement had a balance of $8,460 on November 30, 2019. 3) A check from customer CC New York for $725 was returned marked NSF. 4) A deposit of $1,750 made on 11/30/2019 was not on the bank statement. 5) Bank Service Charges was $75 for November 6) The bank collected a customer's note receivable for $1,400 plus interest of $100. 7) Total outstanding checks on November 30 were $1,150 8) A check to purchase equipment was incorrectly recorded by the company for $920. The check was for $290 and the bank deducted the correct amount.

Answer 1

Doice & Gabana Company Bank Reconciliation November 30, 2019 Cash Balance as per Bank Statement Add: Deposit in transit $ 8,460 1,750 10,210 1,150 9,060 Deduct: Outstanding checks Adjusted Balance $ $ 7,730 Cash Balance as per company's record Add: Proceeds of note collected by bank including $100 interest Add: Error in recording check (920 - 290) 1,500 630 2,130 9,860 Deduct: Bank service charges Deduct: NSF check 725 800 9,060 Adjusted Balances

Journal Entry Account Titles and Explanation Date Debit Credit Nov 30 1,500 Cash Note receivable Interest revenue (to record note received along with interest) 1,400 100 Nov 30 Cash Equipment (to rectify the error made in recording) 630 Nov 30 725 Accounts receivable - CC New York Cash (to record check returned due to NSF) 725 Nov 30 Miscellaneous expense Cash (to record bank service charges)