Bank reconciliation Obj. 5
The following bank reconciliation was prepared as of June 30, 20Y7:
Poway Co.
Bank Reconciliation
For the Month Ended June 30, 20Y7
Cash balance according to bank statement . . . . . . . . . . . . . . . . . . . . . . . . . . $16,185
Add: Outstanding Check No. 1067 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 575
Outstanding Check No. 1106 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 470
Outstanding Check No. 1110 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,050
Outstanding Check No. 1113 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 910
Total additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,005
Deduct: Deposit of June 30 not recorded by bank . . . . . . . . . . . . . . . . . . . . (6,600)
Adjusted balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $12,590
Cash balance according to company’s records . . . . . . . . . . . . . . . . . . . . . . . $ 8,985
Add: Proceeds of note collected by bank: Face value . . . . . . . . . . . . . . . . . . $6,000
Proceeds of note collected by bank: Interest . . . . . . . . . . . . . . . . . . . . 300
Service charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Total additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,315
Deduct: Check returned because of insufficient funds . . . . . . . . . . . . . . . . $ 890
Error in recording June 17 deposit of $7,150 as $1,750 . . . . . . . . 5,400
Total deductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,290)
Adjusted balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,010
a. Identify the errors in the bank reconciliation.
b. Prepare a corrected bank reconciliation.AppendixLO1