The Cash account in the ledger of Hensley Limited showed a balance of $3,100 at June 30. The bank statement, however, showed a balance of $3,900 at the same date. The only reconciling items consisted of a $700 deposit in transit, a bank service charge of $7, and a large number of outstanding checks.
-Refer to the above data. Upon completion of the bank reconciliation, a journal entry will be required to update the depositor's accounting records. This entry will include:

Question

Quizplus · Accepted Answer

A journal entry is required to record the bank service charge, which is an expense. Therefore, a debit to Bank Service Charge Expense for $7 is needed to reflect this charge in the accounting records.

The Cash Account in the Ledger of Hensley Limited Showed