Cawthra Limited gathered the following reconciling information in preparing its June ban reconciliation: The adjusted cash balance per books at June 30 is
A) $16,500.
B) $8,775.
C) $16,725.
D) $12,000.

Question

Cawthra Limited gathered the following reconciling information in preparing its June ban reconciliation:  The adjusted cash balance per books at June 30 is
A) $16,500. 
B) $8,775. 
C) $16,725. 
D) $12,000.

Quizplus · Accepted Answer

The reconciling items are:

- Deposits in transit: $3,000
- Outstanding checks: $1,800
- Bank service charge: $150
- Interest earned: $75
- NSF check: $600 (deducted from the company's cash balance)

To calculate the adjusted cash balance per books, we start with the bank's ending balance and add deposits in transit, then subtract outstanding checks, bank service charge, and NSF check, and add interest earned.

Beginning balance: $10,500
Add: Deposits in transit: $3,000
Adjusted balance: $13,500
Less: Outstanding checks: $1,800
Less: Bank service charge: $150
Less: NSF check: $600
Add: Interest earned: $375

Adjusted cash balance per books: $16,725 (Option C)

Cawthra Limited Gathered the Following Reconciling Information in Preparing Its