Question

The May 31, 2012, balance per bank statement for Upton Company was $7,200. The cash balance per books was $9,500. Outstanding checks amounted to $800, and deposits in transit were $2,400. The bank statement contained an NSF check for $500, a service charge for $25, and a debit memo for direct payment of the telephone bill of $175.

Required:

1) Prepare a bank reconciliation to determine the true cash balance at May 31, 2012.

Answer 1

Upton Company
Bank Reconciliation Statement
May 31, 2012
Balance as per Cash Book	9,500
Less: Direct debit of telephone bill	(175)
Less: Bank charges not recorded
NSF check	(500)
Service charge	(25)
True Cash Balance	8,800