1. The cash transactions and cash balances of Flagg, Inc., for August were as follows:

1. The ledger account for Cash showed a balance at August 31 of $9,200.

2. The August bank statement showed a closing balance of $7,480.

3. The cash received on August 31 amounted to $3,100. It was left at the bank in the night depository chute after banking hours on August 31 and therefore was not recorded by the bank on the August statement.

4. Also included with the August bank statement was a debit memorandum from the bank for $25 representing service charges for August.

5. A credit memorandum enclosed with the August bank statement indicated that a non-interest-bearing note receivable for $3,000 from Joyce Sisters Manes, left with the bank for collection, had been collected and the proceeds credited to the account of Flagg, Inc.

6. Comparison of the paid checks returned by the bank with the entries in the accounting records revealed that check no. 912 for $630, issued August 15 in payment for computer equipment, had been erroneously entered in Flaggs records as $360.

7. Examination of the paid checks also revealed that three checks, all issued in August, had not yet been paid by the bank: no. 917 for $270; no. 919 for $130; no. 922 for $200.

8. Included with the August bank statement was a $200 check drawn by Sharon Jaffer, a customer of Flagg, Inc. This check was marked NSF. It had been included in the deposit of August 27 but had been charged back against the companys account on August 31.

Instructions

a. Prepare a bank reconciliation for Flagg, Inc., at August 31.