The following information is needed to reconcile the cash balance for Woods Paper Products. • A deposit of $5 794.62 is in transit.
• Outstanding cheques total $1 533.25.
• The book balance is $5 695.62.
• The bookkeeper recorded a $1 524.00 cheque as $15 240 in payment of the current month's rent.
• The bank balance at 28 February 2014 was $16 500.25.
• A deposit of $300 was credited by the bank for $3 000.
• A customer's cheque for $1 280 was returned for nonsufficient funds.
• The bank service charge is $70.
What was the adjusted bank balance?

Question

Quizplus · Accepted Answer

The adjusted bank balance is calculated as follows: Start with the bank balance of $16,500.25, add the deposit in transit of $5,794.62, subtract the outstanding cheques of $1,533.25, correct the deposit error by subtracting $2,700 ($3,000 - $300), and adjust for the NSF cheque by subtracting $1,280. The adjusted bank balance is $18,061.62.

The Following Information Is Needed to Reconcile the Cash Balance