On May 31, 2008, James Logan Company had a cash balance per books of \($6,781.50.\)

The bank statement from Farmers State Bank on that date showed a balance of \($6,404.60.\) A comparison of the statement with the cash account revealed the following facts.

1. The statement included a debit memo of \($40\) for the printing of additional company checks.

2. Cash sales of \($836.15\) on May 12 were deposited in the bank. The cash receipts journal entry and the deposit slip were incorrectly made for \($886.15.\) The bank credited Logan Company for the correct amount.

3. Outstanding checks at May 31 totaled \($576.25.\) Deposits in transit were \($1,916.15.\)

4. On May 18, the company issued check No. 1181 for \($685\) to Barry Trest, on account. The check, which cleared the bank in May, was incorrectly journalized and posted by Logan Company for \($658.\)

5. A \($2,500\) note receivable was collected by the bank for Logan Company on May 31 plus \($80\) interest. The bank charged a collection fee of \($20.\) No interest has been accrued on the note.

6. Included with the cancelled checks was a check issued by Bridgetown Company to Tom Lujak for \($800\) that was incorrectly charged to Logan Company by the bank.

7. On May 31, the bank statement showed an NSF charge of \($680\) for a check issued by Sandy Grifton, a customer, to Logan Company on account.

Instructions

(a) Prepare the bank reconciliation at May 31, 2008.

(b) Prepare the necessary adjusting entries for Logan Company at May 31, 2008.