PROBLEM 111 (20%) The balance in the Cash-in-Bank account for Francesca Company
ID: 2587115 • Letter: P
Question
PROBLEM 111 (20%) The balance in the Cash-in-Bank account for Francesca Company dn74.0 while the bank statement of the same date indicated a balance of $4,740.00 The reconciling data is as follows: A. Outstanding checks totaled $460 cesca deposit of $170 into the night depository on March 31t was made too late to appear in the March bank statement. rancesca wrote a check to the Russo Company, a creditor, for $94. The check was recorded however in the cash payments journal as $49. The bank collected a promissory note receivable for Francesca. The cash proceeds collected from the note were $1.100, The face value of the note was $1,000 C. F D. E. Bank charges were $15. F. Received an NSF check from Chris Carlin, $200. EQUIRED: 1. Prepare the bank reconciliation 2. Prepare the necessary correcting journal entries.Explanation / Answer
SOLUTION:
BANK RECONCILIATION
Cash balance per bank statement
4740
Add: Deposit
170
Add: Deposits in transit
Less: Outstanding checks
-460
Adjusted cash balance per bank
4450
Cash balance per books.
3610
Less: Error
-45
Less: Bank service charge
-15
Add: Notes
1100
Less: NSF Checks
-200
Adjusted cash balance per books
4450
1) Dr. Accounts receivable $45
Cr. Cash $45
2) Dr. Bank service charge exp $15
Cr. Cash $15
3) Dr. Cash $1,100
Cr. Notes Receivable $1,000
Cr. Interest Revenue $100
4) Dr. Accounts receivable $200
Cr. Cash $200
BANK RECONCILIATION
Cash balance per bank statement
4740
Add: Deposit
170
Add: Deposits in transit
Less: Outstanding checks
-460
Adjusted cash balance per bank
4450
Cash balance per books.
3610
Less: Error
-45
Less: Bank service charge
-15
Add: Notes
1100
Less: NSF Checks
-200
Adjusted cash balance per books
4450
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