The cash account for Capstone Medical Co. at November 30, 2016, indicated a bala
ID: 2471069 • Letter: T
Question
The cash account for Capstone Medical Co. at November 30, 2016, indicated a balance of $82,726. The bank statement indicated a balance of $128,040 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 $34,090. B. A deposit of $18,430, representing receipts of November 30, had been made too late to appear on the bank statement. C. The bank collected $31,779 on a $29,700 note, including interest of $2,079. D. A check for $1,900 returned with the statement had been incorrectly recorded by Capstone Medical Co. as $190. The check was for the payment of an obligation to ABC Supply Co. for a purchase on account. E. A check drawn for $370 had been erroneously charged by the bank as $730. F. Bank service charges for November amounted to $55. Instructions 1. Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.“Deduct:” or “Add:” will automatically appear if it is required. 2. Journalize the necessary entries. The accounts have not been closed. Refer to the Chart of Accounts for exact wording of account titles. 3. If a balance sheet were prepared for Capstone Medical Co. on November 30, 2016, what amount should be reported as cash? 1. Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. “Deduct:” or “Add:” will automatically appear if it is required. Whenever there is more than one adjusting item in the bank portion of the reconciliation or the general ledger portion of the bank reconciliation, enter in the order presented in the instructions. CAPSTONE MEDICAL CO. Bank Reconciliation November 30, 2016 1 Cash balance according to bank statement 2 3 4 5 6 Adjusted balance 7 8 Cash balance according to company’s records 9 10 11 12 13 Adjusted balance 2. Journalize the necessary entries. The accounts have not been closed. Refer to the Chart of Accounts for exact wording of account titles. PAGE 1 JOURNAL DATE DESCRIPTION POST. REF. DEBIT CREDIT 1 2 3 4 5 6 3. If a balance sheet were prepared for Capstone Medical Co. on November 30, 2016, what amount should be reported as cash?
CAPSTONE MEDICAL CO.
Bank Reconciliation
November 30, 2016
1
Cash balance according to bank statement
2
3
4
5
6
Adjusted balance
7
8
Cash balance according to company’s records
9
10
11
12
13
Adjusted balance
JOURNAL
1
2
3
4
5
6
3. If a balance sheet were prepared for Capstone Medical Co. on November 30, 2016, what amount should be reported as cash?
CAPSTONE MEDICAL CO.
Bank Reconciliation
November 30, 2016
Explanation / Answer
Capstone Medical Company Bank Reconciliation Statement As on Nov 30 , 2016 Details Amt $ Balance as per Bank Statement 128,040 Less: Check Outstanding (34,090) Add: Deposit in Transit 18,430 Less: Note collected with interest not in cash GL (31,779) Add: Check recording Error in Cash GL 1,710 Add: Error in Check recording by Bank 360 Add: Bank charges not in Cash GL 55 Balance as per Cash Book Nov 30 82,726 Adjusted Balance Bank Details Amt $ Balance as per Bank Statement 128,040 Less: Check Outstanding (34,090) Add: Deposit in Transit 18,430 Add: Error in Check recording by Bank 360 Adjusted Balance Bank 112,740 Adjusted Balance Cash Amt $ Balance as per Cash Book Nov 30 2016. 82,726 Add ; Note Collected 29,700 Add ; Interest Collected 2,079 Less : Bank Charges (55) Less : Check recording Error in Cash GL (1,710) Adjusted Balance Cash Book 112,740 Adjustment Journal Entries Account Title Dr $ Cr $ Cash 29,700 Accounts Receivable 29,700 Interest Revenue 2,079 Cash 2,079 Cash 55 Bank Charges 55 Cash 1,710 Accounts Payable 1,710
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