The following information was available to the accountant of Dove Company when preparing the monthly bank reconciliation: $$\begin{array} { | l | r | }
\hline \text { Cash balance per bank } & \$ 3,450 \
\hline \text { Outstanding cheques } & 972 \
\hline \text { NSF cheque returned with the bank statement } & 58 \
\hline \text { Deposits in transit } & 351 \
\hline \text { Bank service charges } & 33 \
\hline \text { Notes receivable from customer, collected by bank } & 575 \
\hline \begin{array} { l }
\text { Error: cash payment of } \$ 532 \text { received from a customer was } \
\text { incorrectly recorded on the books as }
\end{array} & 523 \
\hline
\end{array}$$ What was the cash balance per books of Dove Company prior to beginning the bank reconciliation?
A) $2,238.
B) $2,270.
C) $2,336.
D) $2,354.

Question

The following information was available to the accountant of Dove Company when preparing the monthly bank reconciliation: $$\begin{array} { | l | r | } 
\hline \text { Cash balance per bank } & \$ 3,450 \
\hline \text { Outstanding cheques } & 972 \
\hline \text { NSF cheque returned with the bank statement } & 58 \
\hline \text { Deposits in transit } & 351 \
\hline \text { Bank service charges } & 33 \
\hline \text { Notes receivable from customer, collected by bank } & 575 \
\hline \begin{array} { l } 
\text { Error: cash payment of } \$ 532 \text { received from a customer was } \
\text { incorrectly recorded on the books as }
\end{array} & 523 \
\hline
\end{array}$$ What was the cash balance per books of Dove Company prior to beginning the bank reconciliation?
A) $2,238.
B) $2,270.
C) $2,336.
D) $2,354.

Quizplus · Accepted Answer

The cash balance per books is calculated by adjusting the bank balance for outstanding checks and deposits in transit, and then adjusting for errors and other items. Starting with the bank balance of $3,450, subtract outstanding checks ($972) and add deposits in transit ($351) to get $2,829. Then adjust for the NSF cheque ($58), bank service charges ($33), notes receivable ($575), and the error ($9 difference), resulting in a cash balance per books of $2,336.

The Following Information Was Available to the Accountant of Dove