Question

Problem 4-3A Prepare the bank reconciliation and record cash adjustments (L04-5) [The following information applies to the questions displayed below.] The cash records and bank statement for the month of May for Diaz Entertainment are shown below. DIAZ ENTERTAINMENT Cash Account Records May 1, 2021, to May 31, 2021 Cash Balance Cash Balance Cash May 1, 2021 + Cash Receipts Disbursements May 31, 2021 $5,410 $11, 390 $11, 448 $5,360 Cash Receipts Cash Disbursements Date Desc Amount Date Check# Desc Amount 5/3 Sales $ 1,330 5/7 471 Legal fees $ 1,170 5/10 Sales 1,760 5/12 472 Property tax 1,540 5/17 Sales 2,390 5/15 473 Salaries 3,47€ 5/24 Sales 2,860 5/22 474 Advertising 1,370 5/31 Sales 3,050 5/30 475 Supplies 420 5/31 476 Salaries 3,470 $11,390 $11,440 Member FDIC 7772854360 May 31, 2021 Ending Balance May 31, 2021 $6,587 P.O. Box 162647 Midwest Bank Bowlegs, OK 74830 Looking Out For You (405) 369-CASH Account Holder: Diaz Entertainment Account Number: 124 Saddle Blvd, Bowlegs, OK 74830 Statement Date: Account Summary Beginning Balance Deposits and Credits Withdrawals and Debits May 1, 2021 NO Total NO. Total $6,138 7 $9,504 $9,847 Account Details Deposits and Credits Withdrawals and Debits Date Amount Desc. Date No. Amount Desc. 5/4 $1,330 DEP 5/1 469 $ 420 CHK 5/11 1,760 DEP 5/2 470 380 CHK 5/18 2,390 DEP 5/9 471 1,170 CHK 5/20 1,180 NOTE 5/11 270 NSF 5/20 47 INT 5/12 472 1,540 CHK 5/25 2,860 DEP 5/18 473 3,470 CHK 5/31 17 INT 5/20 470 EFT 5/25 474 1,376 CHK 5/31 37 SF $ 9,584 $9,847 Daily Balance Date Amount 5/1 $5,710 5/2 5,410 5/4 6,740 5/9 5,570 5/11 7,860 5/12 5,520 5/18 4,440 5/20 5,117 5/25 6,687 5/31 $6,587 Desc. DEP Customer deposit NOTE Note collected EFT Electronic funds transfer INT Interest earned CHK Customer check SF Service fees NSF Nonsufficient funds Additional information: a. The difference in the beginning balances in the company's records and the bank statement relates to checks #469 and #470, which are outstanding as of April 30, 2021 (prior month). b. The bank made the EFT on May 20 in error. The bank accidentally charged Diaz for payment that should have been made on another account.

Answer 1

A B с 1 DIAZ ENTERTAINMENT 2 Bank Reconciliation 3 May 31, 2021 4 Bank's Cash Balance Company's Cash Balance 5 Per bank statement $ 6,587 Per general ledger $5,360 6 Add: Deposits in transit $ 3,050 Add: Note collected $1,100 7 Less: Outstanding checks Add: Interest earned $ 64 8 Check no: 475 $ -420 Less: NSF check $ -270 9 Check no: 476 $-3,470 Less: Service fees $ -37 10 Add: Bank error $ 470 11 Bank balance per reconciliation | $ 6,217 Company balance per reconciliation $6,217

A B с D 1 DIAZ ENTERTAINMENT 2 Bank Reconciliation 3 May 31, 2021 4 Bank's Cash Balance Company's Cash Balance 5 Per bank statement 6587 Per general ledger 5360 6 Add: Deposits in transit 3050 Add: Note collected 1100 7 Less: Outstanding checks Add: Interest earned -47+17 8 Check no: 475 -420 Less: NSF check -270 9 Check no: 476 -3470 Less: Service fees -37 10 Add: Bank error 470 11 Bank balance per reconciliation -SUM(B5:310) Company balance per reconciliation =SUM(D5:010)

Credit Debit $ 1,164 Transaction General Journal 1 Cash Notes receivable Interest revenue (To record the amounts that increase cash) $ 1,100 $ 64 2 $ 270 $ 37 Accounts receivable Bank service fees/Miscellaneous expense Cash (To record the amounts that decrease cash) $ 307