1. using the four steps in the reconciliation procedure, prepare a bank reconciliation at December 31.

2. Prepare the adjusting entries based on the reconciliation.

Problem 8-05A a-b (Video) The bank portion of the bank reconciliation for Vaughn Company at November 30, 2020, was as follows. Vaughn COMPANY Bank Reconciliation November 30, 2020 Cash balance per bank Add: Deposits in transit $14,767.90 2,530.20 17,298.10 Less: Outstanding checks Check Number 3451 3470 3471 3472 3474 Check Amount 2,260.40 720.10 844.50 1,426.80 1,054.50 6,306.30 Adjusted cash balance per $10,991.80 bank The adjusted cash balance per bank agreed with the cash balance per books at November 30. The December bank statement showed the following checks and deposits. Bank Statement Checks Deposits Date Number 3451 3471 3472 3475 3476 3477 3479 3480 3482 3483 3485 Amount Date 12-1 12-4 Amount $2,260.40 844.50 1,426.80 12-7 12-4 12-8 12-10 12-15 12-27 12-30 12-29 12-31 $ 2,530.20 1,211.60 2,365.10 2,672.70 2,945 2,567.30 2,836 1,025 $18,152.90 1,640.70 12-16 1,300 12-21 2,130 12-26 3,080 12-29 600 12-30 475.50 1,140 520.80 $15,418.70 Total Total The cash records per books for December showed the following. Cash Payments Journal Date Number Amount Date Number Amount Cash Receipts Journal Date 12-3 12-7 Amount 3475 3476 3477 3478 3479 3480 3481 $1,640.70 12-20 3482 1,300 12-22 3483 2,130 12-23 3484 621.30 12-24 3485 3,080 12-30 3486 $475.50 1,140 1,211.60 2,365.10 2,672.70 2,954 2,567.30 2,836 1,025 1,690.40 $17,322.10 12-2 12-4 12-8 12-10 12-17 793.50 12-15 250.80 12-20 889.50 12-25 $13,728.70 12-28 12-30 12-31 9 600 Total 807.40 Total Cash Payments Journal Cash Receipts Journal Date Date Number Amount Date Number 12-1 12-2 12-2 12-4 12-8 12-10 12-17 Amount Amount 3475 3476 3477 3478 3479 3480 3481 $1,640.70 12-203482 1,300 12-2 3483 2,130 12-23 3484 621.30 12-24 3485 3,080 12-30 3486 $475.50 12-3 1,140 12-7 793.50 12-15 12-20 12-25 $13,728.70 12-28 12-30 12-31 $1,211.60 2,365.10 2,672.70 2,954 2,567.30 2,836 1,025 1,690.40 $17,322.10 250.80 889.50 600 Total 807.40 Total The bank statement contained two memoranda: 1. A credit of $2,330 for the collection of Langer Company of an electronic funds transfer. 2. A debit for the printing of additional company checks $89.50. At December 31, the cash balance per books was $14,585.20, and the cash balance per the bank statement was $19,742.60. The bank did not make any errors, but Langer Company made two errors. VAUGHN COMPANY Bank Reconciliation December 31, 2020 14767.90 Cash balance per bank statement 2530.20 AddDeposits in transit 17298.10 Less v Outstanding checks No. 3470 s720.10 1054.50 No. 3474 621.30 No. 3478 No. 3481 No. 3484 807.40 793.50 No. 3486 889.50 4886.30 Adjusted cash balance per bank 12411.80 Cash balance per books 14585.20 Prepare the adjusting entries based on the reconciliation. (Credit account titles are automatically indent when amount is entered. Do not indent manually. Round answers to 2 decimal places, e.g. 52.75. No. Account Titles and Explanation Dec. 31 Cash Debit Credit Notes Receivable (To record collection of note receivable by bank) Dec. 31 Miscellaneous Expense Cash (To record bank service charge) Dec. 31 Accounts Payable Cash (To correct error in recording check) Dec. 31 Accounts Receivable Cash (To correct error in deposit)