Question

Required information

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The cash records and bank statement for the month of July for Glover Incorporated are shown below.

GLOVER INCORPORATED

Cash Account Records

July 1, 2021, to July 31, 2021

Cash Balance

Cash Balance

July 1, 2021

+

Cash Receipts

−

Cash Disbursements

=

July 31, 2021

$6,950

$8,300

$8,600

$6,650

Cash Receipts

Cash Disbursements

Date

Desc.

Amount

Date

Check#

Desc.

Amount

7/9

Sales

$

2,520

7/7

531

Rent

$

1,460

7/21

Sales

3,100

7/12

532

Salaries

1,920

7/31

Sales

2,680

7/19

533

Equipment

3,100

7/22

534

Utilities

860

7/30

535

Advertising

1,260

$

8,300

$

8,600

P.O. Box 123878

FIDELITY UNION

Member FDIC

Gotebo, OK 73041

You Can Bank On Us

(580) 377-OKIE

Account Holder:

Glover Incorporated

Account Number:

2252790471

519 Main Street

Gotebo, OK 73041

Statement Date:

July 31, 2021

Beginning Balance

Deposits and Credits

Withdrawals and Debits

Ending Balance

July 1, 2021

NO.

Total

NO.

Total

July 31, 2021

$7,500

3

$5,666

7

$ 8,396

$ 4,770

Deposits and Credits

Withdrawals and Debits

Daily Balance

Date

Amount

Desc.

Date

No.

Amount

Desc.

Date

Amount

7/10

$

2,520

DEP

7/2

530

$

550

CHK

7/2

$

6,950

7/22

3,100

DEP

7/10

531

1,460

CHK

7/10

8,010

7/31

46

INT

7/14

532

1,920

CHK

7/14

6,090

7/18

360

NSF

7/18

5,730

7/22

533

3,600

CHK

7/22

5,230

7/26

460

EFT

7/26

4,770

7/30

46

SF

7/30

4,724

7/31

$

4,770

$

5,666

$

8,396

Desc.	DEP Customer deposit	INT Interest earned	SF Service fees
	NOTE Note collected	CHK Customer check	NSF Nonsufficient funds
	EFT Electronic funds transfer

Additional information:

1. The difference in the beginning balances in the company’s records and the bank statement relates to check #530, which is outstanding as of June 30, 2021.

2. Check #533 is correctly processed by the bank.

3. The EFT on July 26 relates to the purchase of office supplies.

Required:

1. Prepare a bank reconciliation for Glover’s checking account on July 31, 2021. (Amounts to be deducted should be indicated with a minus sign. Total entries to the same account together when entering in the bank reconciliation.)

	GLOVER INCORPORATED Bank Reconciliation July 31, 2021 Bank’s Cash Balance Company’s Cash Balance Per bank statement Per general ledger Bank balance per reconciliation Company balance per reconciliation

Answer 1

Solution:

Glover Incorporated
Bank Reconciliation - July 31
Bank's Cash balance		Company's cash balance
Particulars	Amount	Particulars	Amount
Ending balance as per Bank Statements	$4,770.00	Ending Balance as per cash books	$6,650.00
Additions:		Additions:
Outstanding Deposits	$2,680.00	Interest earned	$46.00
Deductions:		Deductions:
Outstanding Checks (Check 534, 535) ($860 + $1,260)	$2,120.00	NSF Cheque	$360.00
		EFT	$460.00
		Incorrect recording of check 533	$500.00
		Service Fees	$46.00
Up to date cash balance as per bank	$5,330.00	Up to date cash balance as per books	$5,330.00