On July 31, 2017, Blossom Company had a cash balance per books of $6,350.00. The
ID: 2580113 • Letter: O
Question
On July 31, 2017, Blossom Company had a cash balance per books of $6,350.00. The statement from Dakota State Bank on that date showed a balance of $7,900.80. A comparison of the bank statement with the Cash account revealed the following facts. 1. The bank service charge for July was $17.00 2. The bank collected $1,625.00 for Blossom Company through electronic funds transfer 3. The July 31 receipts of $1,306.30 were not included in the bank deposits for July. These receipts were deposited by the company in a night deposit vault on July 31 4. Company check No. 2480 issued to L. Taylor, a creditor, for $364.00 that cleared the bank in July was incorrectly entered in the cash payments journal on July 10 for $346.00 S. Checks outstanding on July 31 totaled $1,947.10. 6. On July 31, the bank statement showed an NSF charge of $680.00 for a check received by the company from W. Krueger, a customer, on account. Prepare the bank reconciliation as of July 31. (List items that increase balance as per bank&books; first.) BLOSSOM COMPANY Bank ReconciliationExplanation / Answer
Solution:
BANK RECONCILIATION
Cash balance per bank statement
7900.8
Less: Outstanding checks
-1947.1
Add: Deposits in transit
1306.3
Adjusted cash balance per bank
7260
Cash balance per books.
6350
Less: Bank service charge
-17
Less: Error
-18
Add: Deposits through electronic transfer
1625
Less: NSF Checks
-680
Adjusted cash balance per books
7260
Journal entries:
Dr. Cash $1625
Cr. Account payable $1625
Dr. Account recivable $680
Cr, Cash $680
Dr. Account payable $18
Cr. Cash $18
Dr. Miscellaneous expense $17
Cr. Cash $17
BANK RECONCILIATION
Cash balance per bank statement
7900.8
Less: Outstanding checks
-1947.1
Add: Deposits in transit
1306.3
Adjusted cash balance per bank
7260
Cash balance per books.
6350
Less: Bank service charge
-17
Less: Error
-18
Add: Deposits through electronic transfer
1625
Less: NSF Checks
-680
Adjusted cash balance per books
7260
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