On August 2, Northern Motel receives its bank statement (shown on the next page). The company deposits its receipts in the bank and makes all payments by check. The debit memo for $ 37 is for an NSF check written by T. R. Royce. Check no. 1617 for $ 75.50, payable to Mitchel Company (a creditor), was incorrectly recorded in the checkbook and journal as $ 57.50.

The ledger balance of Cash as of July 31 is $ 1,909.30. Outstanding checks as of July 31 are no. 1631, $ 118.20; no. 1632, $ 78.20; and no. 1633, $ 178.36. The accountant notes that the July 31 deposit of $ 630 did not appear on the bank statement.

Required
1. Prepare a bank reconciliation as of July 31 assuming that the debit memos have not been recorded.
2. Record the necessary journal entries.
3. Complete the bank form to determine the adjusted balance ofcash.

Transcribed Image Text:

STANTON NATIONAL BANK ACCOUNT NO. 750-135-772 STATEMENT DATE July 1 to 31, 20- STATEMENT OF Northern Motel 423 E. Long Avenue Rockford, IL 61104 ACCOUNT SUMMARY Balance Last Statement Amount of Checks and Debits Number of Checks Amount of Deposits and Credits Number of Deposits Balance This Statement $1,153.80 $2,105.91 $2,528.17 $1,576.06 CHECK DATE CHECK DATE CHECKS OTHER DEBITS CHECKS | NUMBER | POSTED | AMOUNT | | NU 1617 1618 1619 1620 1621 1622 1623 7-03 7-03 7-03 7-05 7-06 7-06 7-08 75.50 164.00 124.20 137.20 236.25 159.89 244.50 MBER POSTEDAMOUNT 1624 1625 1626 1627 1628 1629 1630 7-08 7-09 7-12 7-14 120.00 409.70 3740 38.49 182.71 96.87 19.20 7-25 7-26 OTHER DEBITS DATE DESCRIPTION POSTEDAMOUNT DM NSF check DM Service char 7-22 3700 23.00 7-31 DEPOSITS OTHER CREDITS DATE DEPOSITS! POSTED | AMOUNT 7-03 DATE POSTED AMOUNT 49150 415.72 439.16 378.20 7-15 7-18 7-28 291.76 142.90 368.93 7-00 7-11 PLEASE EXAMINE THIS STATEMENT CAREFULLY, REPORT ANY POSSIBLE ERRORS WITHIN 10 DAYS. CODE SYMBOLS CM Credit Memo DM Debit Memo OD Overdraft EC Error Correction