As of August 31, the bank statement shows a balance of $14,215. The August 31 un
ID: 2576429 • Letter: A
Question
As of August 31, the bank statement shows a balance of $14,215. The August 31 unadjusted balance in the Cash account of Hall’s Cards is $10,099. A review of the bank statement revealed the following information: 1. A deposit of $1,180 on August 31, 2016, does not appear on the August bank statement. 2. It was discovered that a check to pay for baseball cards was correctly written and paid by the bank for $3,605 but was recorded on the books as $4,505. 3. When checks written during the month were compared with those paid by the bank, three checks amounting to $4,465 were found to be outstanding. 4. A debit memo for $69 was included in the bank statement for the purchase of a new supply of checks.
Prepare a bank reconciliation at the end of August showing the true cash balance.
Prepare a bank reconciliation at the end of August showing the true cash balance.
Explanation / Answer
Unadjusted Bank Balance as of August 31 14215 Additions: Deposit in transit 1180 15395 Deductions: Outstanding checks 4465 True Cash Balance as of August 31 10930 Unadjusted Book Balance as of August 31 10099 Additions: Correction of recording error 900 10999 Deductions: Bank charges 69 True Cash Balance as of August 31 10930
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