The bank portion of the bank reconciliation for Zurich Company at October 31, 2001, is shown here:

The adjusted cash balance per bank agreed with the cash balance per books at October 31. The November bank statement showed the following checks and deposits:

The cash records per books for November showed the following:

The bank statement contained two bank memoranda:
1. A credit of $1,905.00 for the collection of an $1,800 note for Zurich Company plus interest of $120 and less a collection fee of $15. Zurich Company has not accrued any interest on the note.
2. A debit for the printing of additional company checks $70.00.
At November 30 the cash balance per books was $11,133.90 and the cash balance per bank statement was $17,394.60. The bank did not make any errors, but two errors were made by Zurich Company.
Instructions

(a) Using the four steps in the reconciliation procedure described on pages 312-313, prepare a bank reconciliation at November 30.

(b) Prepare the adjusting entries based on the reconciliation. [Note: The correction of any errors pertaining to recording checks should be made to Accounts Payable. The correction of any errors relating to recording cash receipts should be made to Accounts Receivable. ]

Transcribed Image Text:

Cash balance per bank Add: Deposits in transit ZURICH COMPANY Bank Reconciliation October 31, 2001 $12,367.90 1,530.20 13,898.10 Less: Outstanding checks Check Number Check Amount 2451 $1,260.40 2470 720.10 2471 844.50 2472 426.80 2474 1,050.00 4,301.80 Adjusted cash balance per bank $ 9,596.30