The cash account for Santiago Co. on May 31, 2009 indicated a balance of $15,515
ID: 2445519 • Letter: T
Question
The cash account for Santiago Co. on May 31, 2009 indicated a balance of $15,515.00. The March bank statement indicated an ending balance of $20,245.00. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items:
a.
Checks outstanding totaled $4,820.00
b.
A deposit of $3,796.00 had been made too late to appear on the bank statement.
c.
A check for $1,233.00 returned with the statement had been incorrectly recorded as $233.00. The check was originally credited to accounts payable.
d.
The bank collected $5,541.00 on a note left for collection.
e.
Bank service charges for May amounted to $45.00.
f.
A check for $790.00 was returned by the bank because of insufficient funds.
Prepare a bank reconciliation as of May 31, 2009. Journalize the necessary entries.
Santiago Co.
Bank Reconciliation
May 31, 2009
Date
Description
Post Ref
Debit
Credit
a.
Checks outstanding totaled $4,820.00
b.
A deposit of $3,796.00 had been made too late to appear on the bank statement.
c.
A check for $1,233.00 returned with the statement had been incorrectly recorded as $233.00. The check was originally credited to accounts payable.
d.
The bank collected $5,541.00 on a note left for collection.
e.
Bank service charges for May amounted to $45.00.
f.
A check for $790.00 was returned by the bank because of insufficient funds.
Explanation / Answer
Balance as per bank 20245 Add :- Deposit appear too late in bank statement 3796 Less :- Outstanding check 4820 Adjusting balance as per bank 19221 Balance as per book 15515 Add :- Note left for collection by bank 5541 Less :- Check incorrectly recorded (1233-233) 1000 Bank charges 45 Check returned because of sufficient balance 790 Adjusted balance as per book 19221 Journal Entries Dr cr Account Payable 1000 Cash 1000 Cash 5541 Notes receivable 5541 Bank service charges 45 Cash 45 Account Receivable 790 Cash 790
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