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Corporate Financial Accounting 14th Edition by Carl Warren,James Reeve,Jonathan Duchac
Edition 14ISBN: 978-1305653535Corporate Financial Accounting 14th Edition by Carl Warren,James Reeve,Jonathan Duchac
Edition 14ISBN: 978-1305653535 Exercise 16
Bank reconciliation and entries
The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $146,035. The bank statement indicated a balance of $181,965 on June 30, 20Y1. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:
A. Checks outstanding totaled $16,445.
B. A deposit of $9,900, representing receipts of June 30, had been made too late to appear on the bank statement.
C. The bank collected $31,800 on a $30,000 note, including interest of $1,800.
D. A check for $2,000 returned with the statement had been incorrectly recorded by Pala Medical Co. as $200. The check was for the payment of an obligation to Skyline Supply Co. for a purchase on account.
E. A check drawn for $170 had been erroneously charged by the bank as $710.
F. Bank service charges for June amounted to $75.
Instructions
1. Prepare a bank reconciliation.
2. Journalize the necessary entries.
3. If a balance sheet were prepared for Pala Medical Co. on June 30, 20Y1, what amount should be reported as cash?
The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $146,035. The bank statement indicated a balance of $181,965 on June 30, 20Y1. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:
A. Checks outstanding totaled $16,445.
B. A deposit of $9,900, representing receipts of June 30, had been made too late to appear on the bank statement.
C. The bank collected $31,800 on a $30,000 note, including interest of $1,800.
D. A check for $2,000 returned with the statement had been incorrectly recorded by Pala Medical Co. as $200. The check was for the payment of an obligation to Skyline Supply Co. for a purchase on account.
E. A check drawn for $170 had been erroneously charged by the bank as $710.
F. Bank service charges for June amounted to $75.
Instructions
1. Prepare a bank reconciliation.
2. Journalize the necessary entries.
3. If a balance sheet were prepared for Pala Medical Co. on June 30, 20Y1, what amount should be reported as cash?
Explanation
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Bank reconciliation statement (BRS) : Th...
Corporate Financial Accounting 14th Edition by Carl Warren,James Reeve,Jonathan Duchac
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