The bank portion of the bank reconciliation for the Fixar Company at January 31,
ID: 2529626 • Letter: T
Question
The bank portion of the bank reconciliation for the Fixar Company at January 31,2018 is as follows:
FIXAR COMPANY
Bank Reconciliation
January 31, 2018
Cash balance per bank $13,581.90
Add: Deposits in transit 1,432.80
15,014.70
Less: Outstanding checks
Check Number Check Amount
3351 $1,089.20
3370 930.40
3371 844.50
3372 734.90
3374 1,050.00
3375 1,396.60 6,045.60
Adjusted cash balance per bank $8,969.10
The adjusted cash balance per bank agreed with the cash balance per books at January 31st.
The February bank statement showed the following checks and deposits.
Bank Statement
Checks Deposit
Date Number Amount Date Amount
2-1 3370 $ 930.40 2-1 $1,432.80
2-2 3371 844.50 2-4 1,451.50
2-4 3374 1,050.00 2-8 890.10
2-6 3376 2,830.00 2-13 2,575.00
2-7 3377 600.00 2-18 1,472.70
2-10 3379 1,740.00 2-20 2,836.00
2-15 3380 1,330.00 2-25 2,567.30
2-18 3381 695.40 2-27 2,350.00
. 2-27 3383 425.75 2-28 1,186.00
2-28 3386 750.00 Total $16,761.40
2-28 3389 1,210.45
2-28 3392 542.00
Total $12,948.50
The cash records per books for February show the following information:
Cash Payments Journal Cash Receipts Journal
Date Number Amount Date Number Amount Date Amount
2-1 3376 $2,830.00 2-20 3384 730.75 2-3 $1,451.50
2-2 3377 600.00 2-22 3385 882.30 2-7 890.10
2-2 3378 538.20 2-23 3386 750.00 2-12 2,575.00
2-4 3379 1,470.00 2-24 3387 526.70 2-17 1,472.70
2-8 3380 1,330.00 2-25 3388 750.00 2-19 2,863.00
2-10 3381 695.40 2-26 3389 1,210.45 2-24 2,567.30
2-15 3382 547.00 2-27 3392 542.00 2-26 2,350.00
2-18 3383 425.75 Total $13,828.55 2-27 1,186.00
2-28 2,456.00
Total $17,811.60
The bank statement contained two bank memoranda:
1. A credit of $1,895.00 for the collection of a $1,800 note for Fixar Company plus interest of $115 and less a collection fee of $20.
Fixar Company accrued interest to the maturity of the note.
2. A debit for the printing of additional company checks, $75.00.
At February 28 the cash balance per books was $11,118.80 and the cash balance per the bank statement was $17,381.45.
The bank did not make any errors but two errors were made by Fixar Company.
Instructions:
(a) Prepare the bank reconciliation at February 28, 2018
(b) Prepare the adjusting entries based on the reconciliation. (Note. The correction of any errors pertaining to recording checks should be made to Accounts Payable. The correction of any errors relating to recording cash receipts should be made to Accounts Receivable.)
Explanation / Answer
Solution:
PART-1)
BANK RECONCIALATION STATEMENT
Cash Balance as per bank
$17,381.45
Plus: Deposit in transit
$2,456.00
Minus: Outstanding Checks
Check number: 3351
$1,089.20
Check number: 3372
$734.90
Check number: 3375
$1,396.60
Check number: 3378
$538.20
Check number: 3382
$547.00
Check number: 3384
$730.75
Check number: 3385
$882.30
Check number: 3386
$750.00
Check number: 3387
$526.70
$7,195.65
Adjusted Cash Balance as per bank
$12,641.80
Cash balance as per Cash Book
$11,118.80
Plus: Collection of Note receivable
$1,800.00
Interest on Note receivable
$115.00
$1,915
Minus: Collection fee on note receivable
$20.00
Deposit of 19-2 entered wrongly
$27.00
Check no. 3379 entered wrong
$270.00
Printing charges of check book
$75.00
$392.00
Adjusted Cash Balance as per bank
$12,641.80
?
PART-2)
Debit
Credit
Cash
1800
Notes receivable
1800
Cash
115
Interest revenue
115
Office-expense
20
Cash
20
Accounts Receivable
27
Cash
27
Accounts Payable
270
Cash
270
BANK RECONCIALATION STATEMENT
Cash Balance as per bank
$17,381.45
Plus: Deposit in transit
$2,456.00
Minus: Outstanding Checks
Check number: 3351
$1,089.20
Check number: 3372
$734.90
Check number: 3375
$1,396.60
Check number: 3378
$538.20
Check number: 3382
$547.00
Check number: 3384
$730.75
Check number: 3385
$882.30
Check number: 3386
$750.00
Check number: 3387
$526.70
$7,195.65
Adjusted Cash Balance as per bank
$12,641.80
Cash balance as per Cash Book
$11,118.80
Plus: Collection of Note receivable
$1,800.00
Interest on Note receivable
$115.00
$1,915
Minus: Collection fee on note receivable
$20.00
Deposit of 19-2 entered wrongly
$27.00
Check no. 3379 entered wrong
$270.00
Printing charges of check book
$75.00
$392.00
Adjusted Cash Balance as per bank
$12,641.80
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