Consider the following facts: The Cash account in the general ledger for Company

Question

Consider the following facts: The Cash account in the general ledger for Company A has the following information: Balance at September 1 = $17,150 Balance at September 30 = $17,704 Cash deposits during September = $64,000 Checks written during September = $63,746 The Cash account per the Company A bank statement has the following information: Balance at September 30 = $16,422 Additional information on the September bank statement includes the following: A note receivable for $1,500 was collected plus interest of $30. The bank paid interest on the account of $35. A check for $425 from Eileen Chester was determined to be NSF. Safe deposit box rental charge was $55. On September 30: Deposits in transit = $4,750 Outstanding checks = $2,383 After all the adjusting entries related to the bank reconciliation are posted, the total adjusting debits posted to the Company A Cash account will be $ .

Explanation / Answer

Total debit posted $ 3,948

total credit posted $ 5230

Note receivable is added as it must have increased the bank balance but the cash was not recorded in the ledger

Interest paid on account has in crease the bank balance but no effect on cash acount

Check determined to be NSF would be deducted from cash account as it no longer belongs to company

Safe deposit charges would reduce the cash balance

deposit in transit is not reflected in the bank statement thus it has to be reduced from cash account

outstnding checks has not be withdrawn yet, thus it has not reduced the balance in the bank thus it has to be added back to cash account

Balance as at 30 september          17,704 Add note receivable            1,530 Add interest paid on account                  35 Less check determined to be NSF             (425) safe deposit rental charges                (55) Less deposit in transit          (4,750) Add outstanding checks            2,383 Ending balance reconciled          16,422

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