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Chapters Four, Six and Eight eBook Show Me How Bank Reconciliation and Entries The cash account for Brentwood Bike Co. at May 1 indicated a balance of $14,620. During May, the total cash deposited was $73,980 and checks written totaled $68,590. The bank statement indicated a balance of $25,080 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items: a. Checks outstanding totaled $11,170. b. A deposit of $9,100, representing receipts of May 31 had been made too late to appear on the bank statement. c. The bank had collected for Brentwood Bike Co. $4,810 on a note left for collection. The face of the note was $4,440. d. A check for $360 returned with the statement had been incorrectly charged by the bank as $630. e. A check for $630 returned with the statement had been recorded by Brentwood Bike Co. as $360. The check was for the payment of an obligation to Adkins Co. on account. f. Bank service charges for May amounted to $60. 9. A check for $1,110 from Jennings Co. was returned by the bank due to insufficient funds. Instructions: 1. Prepare a bank reconciliation as of May 31. Brentwood Bike Co. Bank Reconciliation May 31 Cash balance according to bank statement Add deposit of May 31, not recorded by bank 25,080 9,100 S Add bank error in charging check as $630 instead of $360 270 9,370 Deduct outstanding checks 11,170 Adjusted balance 23,280 Cash balance according to company's records 000 Adjusted balance Feedback 2. Joumalize the necessary entries (a.) that increase cash and (b.) that decrease cash. The accounts have not been closed. If an amount box does not require an entry, leave it blank. a. May 31 b. May 31 Check My Work Previous Instructions The following were selected from among the transactions completed by Harrison Company during November of the current year: Nov. 3 4 5 6 8 Purchased merchandise on account from Moonlight Co., list price $94,000, trade discount 25%, terms FOB destination, 2/10, n/30. Sold merchandise for cash, $37,230. The cost of the merchandise sold was $22,500. Purchased merchandise on account from Papoose Creek Co., $48,450, terms FOB shipping point, 2/10, n/30, with prepaid freight of $800 added to the invoice. Returned $15,000 ($20,000 list price less trade discount of 25%) of merchandise purchased on November 3 from Moonlight Co. Sold merchandise on account to Quinn Co., $15,810 with terms n/15. The cost of the merchandise sold was $10,020. Paid Moonlight Co. on account for purchase of November 3, less return of November 6. Sold merchandise on VISA, $239,690. The cost of the merchandise sold was $129,230. Paid Papoose Creek Co. on account for purchase of November 5. Received cash on account from sale of November 8 to Quinn Co. Sold merchandise on account to Rabel Co., $54,200, terms 1/10, n/30. The cost of the merchandise sold was $33,490. Paid VISA service fee of $3,220. Paid Quinn Co. a cash refund of $1,750 for damaged merchandise from sale of November 8. Quinn Co. kept the merchandise. 13 14 15 23 24 28 30 Required: Journalize the transactions. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every fine on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered
