Consider the following facts for Company A: Cash account balance per the general

Question

Consider the following facts for Company A: Cash account balance per the general ledger at May 31 = $13,287. Cash account balance per the bank statement at May 31 = $14,157. The bank statement included a debit memo of $35 for check printing charges. Cash sales of $1,720 on May 12 were deposited in the bank. The deposit was incorrectly recorded in Company A books for $1,820. The bank credited the cash account for the correct amount. At May 31, outstanding checks totaled $1,225. At May 31, deposits in transit totaled $2,100. On May 18, Company A issued check #1181 for $191 to Company B for payment on account. The check cleared the bank in May, but was incorrectly recorded by Company A on its books for $119. A $4,000 not receivable was collected by the bank for Company A on May 31 plus interest of $80. The bank charged a collection fee of $20. No interest had been accrued by Company A for the note. In the cancelled checks received with the bank statement, there was check for $800 issued by another company and incorrectly charged to Company A by the bank. On May 31, the bank statement showed an NSF charge of $1,308 for a check issued by a customer to Company A as payment on account. Company A's bank reconciliation for May 31, 2014 should show an adjusted Cash account balance of $

Explanation / Answer

correct option is "D"

cash Balance as per books 13287 less:Bank service charge (35) Error in recording deposit (1820-1720 ) (100) Error in recording issued check   (191-119) (72) Note received [4000+80-20] 4060 NSF check returned (1308) Adjusted balance as per book 15832

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