Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Problem 7 - 7 A Preparing a bank reconciliation and recording adjustments LO 6 The following information was available to reconcile Montrose Companys book balance

Problem 7-7A Preparing a bank reconciliation and recording adjustments LO6The following information was available to reconcile Montrose Companys book balance of Cash with its bank statement balance as of October 31,2023: After all posting was completed on October 31, the companys Cash account had a $13,169 debit balance but its bank statement showed a $29,324 balance.Cheques #296 for $1,333 and #307 for $12,744 were outstanding on the September 30 bank reconciliation. Cheque #307 was returned with the October cancelled cheques, but cheque #296 was not. It was also found that cheque #315 for $892 and cheque #321 for $1,998, both written in October, were not among the cancelled cheques returned with the statement.In comparing the cancelled cheques returned by the bank with the entries in the accounting records, it was found that cheque #320 for the October rent was correctly written for $7,100 but was erroneously entered in the accounting records as $7,820.A credit memo enclosed with the bank statement indicated that there was an electronic fund transfer related to a customer payment for $21,935. A $120 bank service charge was deducted. This transaction was not recorded by Montrose before receiving the bank statement.A debit memo for $3,252 listed a $3,203 NSF cheque plus a $49 NSF charge. The cheque had been received from a customer, Jefferson Tyler. Montrose had not recorded this bounced cheque before receiving the statement.Also enclosed with the statement was a $74 debit memo for bank services. It had not been recorded because no previous notification had been received.The October 31 cash receipts, $7,277, were placed in the banks night depository after banking hours on that date and this amount did not appear on the bank statement.Required:1. Prepare a bank reconciliation for the company as of October 31,2023.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Statement Analysis

Authors: K. R. Subramanyam, John Wild

11th edition

78110963, 978-0078110962

More Books

Students also viewed these Accounting questions

Question

20. Describe trend analysis and why it is useful.

Answered: 1 week ago