On August 31, 2019, the balance in the checkbook and the Cash account of the Dry

Question

On August 31, 2019, the balance in the checkbook and the Cash account of the Dry Creek Bed and Breakfast was $12,327. The balance shown on the bank statement on the same date was $13,222.

Notes

The firm’s records indicate that a $1,500 deposit dated August 30 and a $706 deposit dated August 31 do not appear on the bank statement.

A service charge of $9 and a debit memorandum of $345 covering an NSF check have not yet been entered in the firm’s records. (The check was issued by Art Corts, a credit customer.)

The following checks were issued but have not yet been paid by the bank:

  

A credit memorandum shows that the bank collected a $2,109 note receivable and interest of $68 for the firm. These amounts have not yet been entered in the firm’s records.

Required:

Prepare a bank reconciliation statement for the firm as of August 31.

Record general journal entries for items on the bank reconciliation statement that must be journalized.

Analyze:
What effect did the journal entries recorded as a result of the bank reconciliation have on the fundamental accounting equation?

Complete this question by entering your answers in the tabs below.

Bank Rec

General Journal

Analyze

Prepare a bank reconciliation statement for the firm as of August 31.

Bank Rec

Journal entry worksheet

Record the deposit in transit.

Note: Enter debits before credits.

Record the bank service fee.

Note: Enter debits before credits.

Record the returned check.

Note: Enter debits before credits.

Record the outstanding checks.

Note: Enter debits before credits.

Record the note collected by the bank plus interest.

Note: Enter debits before credits.

What effect did the journal entries recorded as a result of the bank reconciliation have on the fundamental accounting equation?

G

Check 712, $ 115 Check 713, $ 130 Check 716, $ 243 Check 736, $ 582 Check 739, $ 83 Check 741, $ 125

Explanation / Answer

What effect did the journal entries recorded as a result of the bank reconciliation have on the fundamental accounting equal

Increase by (68-9)=$59

DRY CREEK BED AND BREAKFAST Bank Reconciliation Statement 08/31/19 Balance on bank statement 13222 Additions: Deposit in Transit 2206 Deductions: Check 712, 115 Check 713, 130 Check 716, 243 Check 736, 582 Check 739, 83 Check 741, 125 Total deductions 1278 Adjusted bank balance 14150 Balance in books 12327 Additions: note receivable 2109 Interest on note receivable 68 2177 Deductions: service charge 9 NSF check 345 354 Adjusted book balance 14150

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