Consider the following situations for Company A: Situation #1: On the June 30 ba

Question

Consider the following situations for Company A:

Situation #1:

On the June 30 bank reconciliation, deposits in transit total $720. During July, the Cash account in the general ledger shows deposits of $15,750. The bank statement for July shows that $15,600 in deposits were received during the month.

Situation #2:

On the June 30 bank reconciliation, outstanding checks were $680. During the month of July, the Cash account in the general ledger shows that $17,200 of checks were issued. The bank statement showed that $16,400 of checks cleared the bank in July.

Situation #3:

In September, deposits per the bank statement totaled $26,700, deposits per books were $25,400, and deposits in transit at September 30 were $2,100.

Situation #4:

In September, cash disbursements per books were $23,700, checks clearing the bank were $25,000, and outstanding checks at September 30 were $2,100.

In all 4 situations, there were no bank debit or credit memos. Also, no Cash account errors were made by either the bank of the company.

In situation #4, the outstanding checks at August 31 were $ ___________.

$3,400

$2,100

None of these answers are correct

$1,870

$3,100

Explanation / Answer

$3,400. The 2100 has yet to be collected, and comes from the 23700. The remainder(21600) reduces the amount actually collected(25000) to get the checks written in Aug but collected in Sept.(3400)

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