Question

Problem 4-3A Prepare the bank reconciliation and record cash adjustments (LO4-5)

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The cash records and bank statement for the month of May for Diaz Entertainment are shown below.

Cash Account Records May 1, 2021, to May 31, 2021 Cash Balance May 31, 2021 $5,340 Cash Balance Cash May 1, 2021 + Receipts $5,400 $11,440 Cash Receipts Date Desc. 5/3 Sales 5/10 Sales 5/17 Sales 5/24 Sales 5/31 Sales Amount $ 1,340 1,770 2,400 2,870 3,060 Date 5/7 5/12 5/15 5/22 5/30 5/31 Cash Disbursements $11,500 Cash Disbursements Check Desc. 471 Legal fees 472 Property tax 473 Salaries Advertising 475 Supplies 476 Salaries Amount $ 1,180 1,550 3,480 1,380 430 3,480 $11,500 474 $11,440 Member FDIC 7772854360 May 31, 2021 Ending Balance May 31, 2021 $6,458 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 Withdrawals and Beginning Balance Deposits and Credits Debits May 1, 2021 NO. Total NO. Total $6,140 7 $9.446 9 $9,128 Account Details Deposits and Credits Withdrawals and Debits Date Amount Desc. Date No. Amount Dese. 5/4 $ 1,340 DEP 5/1 469 $ 430 CHK 5/11 1,770 DEP 5/2 470 310 CHK 5/18 2,400 DEP 5/9 471 1,180 CHK 5/20 1,000 NOTE 5/11 280 NSF 5/20 48 INT 5/12 472 1,550 CHK 5/25 2,870 DEP 5/18 473 3,480 CHK 5/31 18 INT 5/20 480 EFT 5/25 474 1,380 CHK 5/31 38 SE $ 9,446 $9,128 Daily Balance Date Amount 5/1 $5,710 5/2 5,400 5/4 6,740 5/9 5,560 5/11 7,050 5/12 5,500 5/18 4,420 5/20 4,988 5/25 6,478 5/31 $6,458

Answer 1

	DIAZ ENTERTAINMENT
	Bank Reconciliation
	MAY 31 , 2021
	Bank's Cash Balance	Company's Cash Balance
	Per bank statement	6,458	per general ledger	5,340
	Deposits Outstanding	3,060	Interest earned	66
	Bank Error	480	Note Collected	1,000
	Checks Outstanding	(3,910)	NSF Check	(280)
			Service Fees	(38)
	Adjusted Bank Balance	6,088	Adjusted Book Balance	6,088
	Adjustment Entries:
Transactions	Accounts Name and Explanation	Debit	Credit
1)	Cash	1,066
	Interest Revenue		66
	Note Recivable		1,000
	(To record adjustments which increase cash)
2)	Accounts Receivable	280
	Bank Service fees	38
	Cash		318
	(To record adjustments which decrease cash)