Derek Company gathered the following reconciling information in preparing its September bank reconciliation:

Question

Quizplus · Accepted Answer

The reconciling items are:

- Outstanding checks: $5,200
- Deposits in transit: $2,940
- Bank service charge: $50
- NSF check: $30

To adjust the balance per bank, we need to subtract outstanding checks and add deposits in transit. This gives:

- Balance per bank statement: $22,370 - $5,200 + $2,940 = $20,110

To adjust the balance per books, we need to add interest earned and subtract bank service charge and NSF check. This gives:

- Balance per books: $16,950 + $200 - $50 - $30 = $17,070

The difference between the two balances is:

- $20,110 (bank) - $17,070 (books) = $3,040 (unadjusted)

This difference can be explained by the fact that outstanding checks and deposits in transit have not cleared the bank yet. Therefore, we need to add them to the books balance and subtract them from the bank balance to arrive at the adjusted balances:

- Adjusted balance per books: $17,070 + $5,200 - $2,940 = $19,330
- Adjusted balance per bank: $20,110 - $5,200 + $2,940 = $17,850

The adjustment to the books balance is $5,200 - $2,940 = $2,260 (added), while the adjustment to the bank balance is $20,110 - $17,850 = $2,260 (subtracted). The total of these adjustments is $2,260 + $2,260 = $4,520, which is the reconciling item that appears on the reconciliation. However, the question asks for the total reconciling information, which is the sum of all reconciling items, including the bank service charge and NSF check. Therefore, the total reconciling information is:

- Outstanding checks: $5,200
- Deposits in transit: $2,940
- Bank service charge: $50
- NSF check: $30
- Adjustments: $4,520

This gives a total of $13,740, which is closest to answer C ($3,060).

Derek Company Gathered the Following Reconciling Information in Preparing Its