Bank Reconciliation and Entries The cash account for Brentwood Bike Co. at May 1

Question

Bank Reconciliation and Entries

The cash account for Brentwood Bike Co. at May 1 indicated a balance of $12,950. During May, the total cash deposited was $64,420 and checks written totaled $59,810. The bank statement indicated a balance of $21,840 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items:

Checks outstanding totaled $9,730.

A deposit of $7,920, representing receipts of May 31, had been made too late to appear on the bank statement.

The bank had collected for Brentwood Bike Co. $4,190 on a note left for collection. The face of the note was $3,870.

A check for $490 returned with the statement had been incorrectly charged by the bank as $940.

A check for $410 returned with the statement had been recorded by Brentwood Bike Co. as $140. The check was for the payment of an obligation to Adkins Co. on account.

Bank service charges for May amounted to $30.

A check for $970 from Jennings Co. was returned by the bank because of insufficient funds.

gnment-take&norogress-; QSearch … Ch 8-3 Exercises& P Show He How 5. PR.08-04AL 2. Journalze the necessary antries 4.) that increzse casn nd (.) that decrease cash. hs accounts have not been dcsed. For compound transaction, if an amount box does not require an entry, leave it blank. a. Mar 31 b. Nzy 31 3. f a balance sheet were prepared for Brentwond ke Co. on May 31, what ameunt should be reperted as cash? Progress: 55 Items 2 mare Ceck y orkuzes remaning Previous signment score:00% Save and Exit Submit Assignment for Grading

Explanation / Answer

Cash balance at may 1 12,950 add deposits 64,420 less checks written total -59,810 Cash balance at may 31 17,560 Bank Reconciliation Cash balance accounting to bank statement 21,840 Add:deposits in transit 7,920 add:Bank error 450 8,370 30,210 less:outstanding checks 9,730 Adjusted balance 20,480 Cash balance accounting by company's records 17,560 Add:note collected 4,190 21,750 less:error in recording 270 bank service charges 30 NSF 970 1270 Adjusted balance 20,480 2) a. 31-May Cash 4,190 note receivable 3,870 interest income 320 b. 31-May Accounts payable 270 service expense 30 Accounts receivable 970 cash 1,270 3) 20,480

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