BANK RECONCILIATION AND JOURNAL ENTRIES On the basis of the following informatio

Question

BANK RECONCILIATION AND JOURNAL ENTRIES

On the basis of the following information, prepare a bank reconciliation for , ON THE GO, Inc. for the month of JULY 2017.

1. The JULY 30, 2017 bank statement showed the following:

Balance, JULY 1, 2017 $ 21,513
Canceled checks 18,310
Deposits 15,199
Balance, JULY 30, 2017 UNADJUSTED 18,402

No deposits in transit or outstanding checks on June 30, 2017 bank reconciliation.

2. The general ledger cash account showed the following for the month of JULY:

Balance, JULY 1, 2017 $ 17,300
debits (deposits) 18,810
credits (checks) 16,600
Balance, JULY 30, 2017 19,510



3. Bank service charge on the bank statement was $ 36

4. Analysis of cash disbursements journal revealed outstanding checks of $ 4,440.

5. Analysis of cash receipts journal revealed deposits in transit of $ 6,100.

6. The bank statement reveals that company's account has been reduced.. The company had a check of $ 372 from a customer, LOWONCASH, Inc., returned as "not sufficient funds". Bank charged $30 fee for the NSF check.

7. The bank collected $ 990 for the company on a note receivable from PAYONTIME, Inc. Of this amount $ 500 was principal. The accountant for ON THE GO, Inc. was not aware of this collection until the bank statement was analyzed.

REQUIRED:

1. Prepare bank reconciliation in good form for July 31, 2017.

2. Prepare the required general journal entries in good form for July 31, 2017

3. State the amount that should appear on the balance sheet as of August 1, 2017.

Explanation / Answer

1. Bank Reconciliation

2. Journal

3. Amount to appear on the balance sheet as of August 1, 2017 = $20062

Balance as per bank on July 30, 2017: $18402 Add deposits in transit 6100 Less checks outstanding (4440) Adjusted/ Correct balance as per bank $20062 Balance as per books on July 30, 2017: $19510 Add Note receivable collected 990 Less Bank service charge (36) NSF checks and fees (402) Adjusted/ Correct balance as per bank $20062

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