The balance shown in the August bank statement of Colt Company was $23,200.After examining the August bank statement and items included with it,the company's accountant found:
$\begin{array}{lr}
\text { Checks outstanding } & \$ 4,300 \
\text { NSF check } & 140 \
\text { Note collected by bank for the Colt Company } & 1,200 \
\text { Deposits outstanding } & 1,800 \
\text { Bank service fees } & 60
\end{array}$
What is the amount of cash that should be reported in the balance sheet as of August 31?

Question

The balance shown in the August bank statement of Colt Company was $23,200.After examining the August bank statement and items included with it,the company's accountant found:
$\begin{array}{lr}
\text { Checks outstanding } & \$ 4,300 \
\text { NSF check } & 140 \
\text { Note collected by bank for the Colt Company } & 1,200 \
\text { Deposits outstanding } & 1,800 \
\text { Bank service fees } & 60
\end{array}$
 What is the amount of cash that should be reported in the balance sheet as of August 31?

Quizplus · Accepted Answer

The correct answer is A because the cash balance per bank statement is $23,200. Add outstanding deposits of $1,800 and deduct outstanding checks of $4,300 and the NSF check of $140. The resulting cash balance is $20,700.

The Balance Shown in the August Bank Statement of Colt