Calculate, from the following information accumulated by Bob Verna, the adjusted cash balance at the end of July. Bank statement ending cash balance $6,000
General ledger cash balance ending 8,500
Bank monthly service charge 90
Deposits in transit 5,000
Outstanding cheques 3,000
NSF cheque returned with bank statement 410
A) $6,000
B) $8,500
C) $8,000
D) $11,000

Question

Quizplus · Accepted Answer

Starting with the bank statement ending cash balance of $6,000, we add the deposits in transit of $5,000, which have not yet been recorded on the bank statement, but have been recorded in the general ledger, for a subtotal of $11,000. Then, we subtract the outstanding cheques of $3,000, which have been recorded on the bank statement, but have not yet cleared the bank, for an adjusted subtotal of $8,000. Finally, we subtract the bank monthly service charge of $90, and the NSF cheque returned with the bank statement of $410, for a final adjusted cash balance of $7,500. However, the general ledger cash balance ending is given as $8,500, suggesting that there may be additional transactions to take into account, such as deposits or withdrawals not yet recorded on the bank statement. Without further information, the best choice is therefore C, which is the closest to the adjusted subtotal we have calculated ($8,000).

Calculate, from the Following Information Accumulated by Bob Verna, the Adjusted