In the process of reconciling its bank statement for January,Maxi's Clothing's accountant compiles the following information:
$$\begin{array} { | l | r | }
\hline \text { Cash balance per company books on January 30 } & \$ 4,725 \
\hline \text { Deposits in transit at month-end } & \$ 1,800 \
\hline \text { Outstanding checks at month-end } & \$ 520 \
\hline \text { Bank service charges } & \$ 25 \
\hline \text { EFT automatically deducted monthly, not yet recorded by Maxi } & \$ 380 \
\hline \text { An NSF check returned on a customer account } & \$ 265 \
\hline
\end{array}$$
The adjusted cash balance per the books on January 31 is:

Question

In the process of reconciling its bank statement for January,Maxi's Clothing's accountant compiles the following information:
$$\begin{array} { | l | r | } 
\hline \text { Cash balance per company books on January 30 } & \$ 4,725 \
\hline \text { Deposits in transit at month-end } & \$ 1,800 \
\hline \text { Outstanding checks at month-end } & \$ 520 \
\hline \text { Bank service charges } & \$ 25 \
\hline \text { EFT automatically deducted monthly, not yet recorded by Maxi } & \$ 380 \
\hline \text { An NSF check returned on a customer account } & \$ 265 \
\hline
\end{array}$$
The adjusted cash balance per the books on January 31 is:

Quizplus · Accepted Answer

The adjusted cash balance is calculated as follows: Start with the cash balance per books ($4,725), subtract the bank service charges ($25), subtract the EFT ($380), and subtract the NSF check ($265). The deposits in transit and outstanding checks do not affect the book balance. The calculation is $4,725 - $25 - $380 - $265 = $4,055.

In the Process of Reconciling Its Bank Statement for January,Maxi's