Question

Problem 5-3 On July 31, 2017, Keeds Company had a cash balance per books of $6,140.00. The statement from Dakota State Bank on that date showed a balance of $7,690.80. A comparison of the bank statement with the Cash account revealed the following facts. 1. The bank service charge for July was $25.00. 2. The bank collected $1,520.00 for Keeds Company through electronic funds transfer. 3. The July 31 receipts of $1,193.30 were not included in the bank deposits for July. These receipts were deposited by the company in a night deposit vault on July 31. 4. Company check No. 2480 issued to L. Taylor, a creditor, for $384.00 that cleared the bank in July was incorrectly entered in the cash payments record on July 10 for $348.00. 5. Checks outstanding on July 31 totaled $1,860.10. 6. On July 31, the bank statement showed an NSF charge of $575.00 for a check received by the company from W. Krueger, a customer, on account. Prepare the bank reconciliation as of July 31. (List items that increase balance as per bank & books first.) KEEDS COMPANY Bank Reconciliation

Answer 1

Bank Reconciliation is as prepared below:

KEEDS COMPANY
Bank Reconciliation
July 31, 2017
Particulars	Amount ($)	Amount ($)
Balance as per bank		7,691
Add: Deposit in transit		1,193
		8,884
Less: outstanding checks:		1,860
Adjusted cash balance per bank		7,024
Cash balance as per books		6,140
Add: Cash collected		1,520
Less:
NSF Check	575
Error in recording check number 2480 by 348 instead of 384	36
Bank Service Charge	25
Adjusted cash balance as per books		7,024