The following data were accumulated for use in reconciling the bank account of C

Question

The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6:

1. Cash balance according to the company’s records at August 31, $22,569.

2. Cash balance according to the bank statement at August 31, $29,187.

3. Checks outstanding, $13,346.

4. Deposit in transit, not recorded by bank, $7,087.

5. A check for $42 in payment of an account was erroneously recorded in the check register as $420.

6. Bank debit memo for service charges, $19.

Journalize the entry or entries that should be made by the company. Refer to the Chart of Accounts for exact wording of account titles.

Explanation / Answer

Assets liabilities Equity Date Description Debit Credit 31-Aug Cash 378 378 Accounts payable 378 -378 (420-42 31-Aug Miscellaneous expense 19 -19 Cash 19 -19

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