Bank reconciliation The following is information from Hampton Company cash accou

Question

Bank reconciliation

The following is information from Hampton Company cash account for the month of October, 2009. This is the activity per the books. The bank statement is on the next page.

At the end of September, two checks, # 123 and 124, totaling $ 2,450.10 were outstanding.

Check # 127 was recorded in the books at $ 548.75, but correctly cleared the bank at $ 584.75.

Check #128 was recorded in the books at $783.00, but correctly cleared the bank at $ 738.00.

Prepare a bank reconciliation for October 2009 in Microsoft Excel. I won’t give points unless it is prepared in here.

Prepare the proper journal entry(s) to correct the company’s cash account.

Assuming Hampton also has the following items on hand:

Coins and currency = $13,200

Cash held as a compensating balance on a long term note = $10,000

Postdated check from a customer = $1,300

Certificate of deposit maturing on 11/29/09 = $25,000

Short-term treasury bills = $14,500

What amount should be in Cash and Cash equivalents for Hampton on 10/31/09?

** $3,450.00 was a note receivable collected for Hampton Company. Actual amount collected = $3,500.00 and $50.00 was a bank collection fee.

*** $1,135.00 was an amount originally deposited by Hampton from a customer. The customer’s check was for $1,100.00 and $35.00 was a bank fee.

Date Beginning Balance 10-01 10-03 10-04 10-07 10-09 10-10 10-14 10-17 10-20 10-22 10-24 10-25 10-30 10-31 Check # Check Amt Deposit Amt Balance 24,425.00 125 126 127 $ 146.25 1,124.10 548.75 14,500.00 128 ATM 129 5,800.00 500.00 2,775.25 5,900.00 130 ATM 132 783.00 500.00 10,345.50 2,800.00 133 5,600.00 4,750.00

Explanation / Answer

Ans 1 Balance as per Bank 37,696.65 Add:Bank charges on the note collected           50.00 Add :Cheque returned for insufficient funds     1,100.00 Add: Bank charges on above           35.00 Add :Cheque wrongly entered for smaller amount           36.01 Add: Cheque deposited not cleared     4,750.00 Add: Service charges for the month           75.00     6,046.01 Less: Note received in to bank not accounted     3,500.00 Less: Cheque wrongly entered for larger amount           45.00 Less:Cheque issue but not presented for payment 10,345.00 Less:Cheque issue but not presented for payment     5,600.00 19,490.00 Balance as Cash book 24,252.66 Ans 2 Account head and details Debit Credit 1 Cash 3450 Bank charges 50 Note receivable 3500 2 Account Receivable 1100 Bank charges 35 Cash 1135 3 Accounts Payable           36.01 Cash           36.01 4 Cash           45.00 Accounts Payable           45.00 5 Bank Charges 75 Cash 75 Ans 3 Cash and Cash equivalents Coins and currency 13,200.00 Cash at Bank 24,252.66 Short-term treasury bill 14,500 Total 51,952.66

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