The cash account for Capstone Medical Co. at November 30, 2016, indicated a bala
ID: 2464544 • Letter: T
Question
The cash account for Capstone Medical Co. at November 30, 2016, indicated a balance of $84,457. The bank statement indicated a balance of $127,190 on November 30, 2016. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:
A. Checks outstanding totaled $33,310. B. A deposit of $17,610, representing receipts of November 30, had been made too late to appear on the bank statement. C. The bank collected $28,248 on a $26,400 note, including interest of $1,848. D. A check for $1,100 returned with the statement had been incorrectly recorded by Capstone Medical Co. as $110. The check was for the payment of an obligation to ABC Supply Co. for a purchase on account. E. A check drawn for $680 had been erroneously charged by the bank as $860. F. Bank service charges for November amounted to $45.Explanation / Answer
Capstone Medical Company All Amounts in $ 1. Bank Reconciliation Statement as on November 30 Balance as per Cash Book 84457 Add : Cheques issued but not presented 33310 Less : Cheques deposited not cleared as on November 30 -17610 Add : Collections by bank against note 28248 Less : Cheque returned short booked in Capstone's books -990 Less : Amount excess debited by bank -180 Less : Bank Service Charges -45 Balance as per Bank Statement 127190 2. Journal Entries on 30 November Particulars Debit Credit Bank A/c DR 28248 To Note A/c 26400 To Interest on Note A/c 1848 Accounts Payable A/c DR 990 To Bank A/c 990 Accounts Payable A/c DR 180 To Bank A/c 180 Bank Charges A/c DR 45 To Bank A/c 45 3. If a balance sheet were prepared for Capstone Medical Co. on November 30, 2016, the amount to be reported as cash will be $ 84,457 + $ 28,248 - $ 990 - $ 180 - $ 45 = 111490 $
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