write-out The following information pertains to the Family Grocery Store 1. Cash

Question

write-out The following information pertains to the Family Grocery Store 1. Cash balance per bank, May 31, $7,263. 2. Cash balance per books, May 31, $7,634. 3. May bank charges not recorded by the depositor $28. 4. Deposits in transit, May 31, $1,500. 5. Outstanding checks, May 31, $591. 6. The Bank collected $900 note for Family in May, plus interest $36, less fee of $20. The collection has not been recorded by Family and no interest has been accrued. 7. A deposit on May 5 was incorrectly recorded in the company's books as $330. The bank correcty recorded the deposit as $300. A NSF check was returned with the bank statement for $320. The NSF check was from customer Joe Smith as payment on his account. 8. 1. Prepare a bank reconciliation at May 31. 2. Journalize the adjusting entries at May 31 on the books of the Family Grocery Store

Explanation / Answer

A. Bank reconciliation statement:

2. Entries

Cash balance per bank $7,263 Add : deposit in transit $1,500 $8,763 Less: outstanding checks $591 Adjusted cash balance per bank $8,172 Cash balance per books $7,634 Add: collection of note receivable($900+$36-$20) $916 $8,550 Less: bank service charges $28 Book error(330-300) $30 NSF check $320 $378 Adjusted cash balance per books $8172

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