Question

a. The checkbook and the general journal indicated that Check 2206 dated April 17 was issued for $695 to make a cash purchase of supplies. However, examination of the canceled check and the listing on the bank statement showed that the actual amount of the check was $14. b. The checkbook and the general journal indicated that Check 2247 dated April 20 was issued for $130 to pay a utility bill. However, examination of the canceled check and the listing on the bank statement showed that the actual amount of the check was $164. Required: 1. Prepare the adjusted book balance section of the firm's bank reconciliation statement. The book balance as of April 30 was $20,275. The errors listed above are the only two items that affect the book balance. 2. Prepare general journal entries to correct the errors. Check 2206 was correctly debited to Supplies on April 17, and Check 2247 was debited to Utilities Expense on April 20. Analyze: If the errors described had not been corrected, would net income for the period be overstated or understated? By what amount? Complete this question by entering your answers in the tabs below. Bank Rec General Journal Analyze Prepare the adjusted book balance section of the firm's bank reconciliation statement. The book balance as of April 30 was $20,275. The errors listed above are the only two items that affect the book balance. A. FONTES CONSULTANCY Bank Reconciliation Statement April 30, 2019 Balance in books $20,275 Additions: $20 275 Deductions: Adiusted book halance | $20 2751

Answer 1

Solution:

Fontes Consultancy
Bank Reconciliation Statement
April 30' 2019
Particulars	Amount
Balance in books	$20,275.00
Additions:
Incorrect recording of check 2206	$681.00
Deductions:
Incorrect recording of check 2234	$34.00
Adjusted book balance	$20,922.00

Journal Entries
Date	Particulars	Debit	Credit
30-Apr-19	Cash Dr	$681.00
	To Supplies		$681.00
	(To record correction entry for check 2206)
30-Apr-19	Utilities Expense Dr	$34.00
	To Cash		$34.00
	(To record correction entry for check 2234)