30 april 2020

QUESTION 2 (29 marks) Northern Sea Co. started its business on 1 April, 2020, below is the information needed to prepare a bank reconciliation for the business as at 30 April, 2020: Balance per bank statement was $61,300. (ii) Remittance fee of $360 was wrongly deducted to our cash account by the bank in April 2020. Check #162 for electricity expense of April 2020 had cleared by the bank for $370 but was erroneously recorded in our books as $210. (iv) Check #168 amounted to $205 was properly paid to our supplier, Johnson Company, but was incorrectly written as $502 in our own accounting records. (v) Check #145 for $2,380 had been issued in April but was not presented to the bank for payment. (vi) Cash receipts of $6,500 recorded in our books on 30 April were not deposited until 1 May. (vii) A $688 deposit by Fast Track Co. was erroneously credited to our bank account by the bank in April 2020. (viii) The bank statement showed $87 interest earned on the bank balance for the month of April 2020. (ix) Bank service charge for April 2020 amounted $113 was sent to the company together with the bank statement. (x) $1,100 check drawn by a customer Nelson had been marked "NSF in April and the company received this notice at the beginning of May 2020. Required: (a) Prepare a bank reconciliation statement for Northern Sea Co. as of 30 April 2020 and determine the cash account balance of the company records as of April 30, 2020 before the adjustments. (22 marks) (b) Prepare the necessary adjustment journal entries on the book balance. (Explanations are not required for the journal entries) (7 marks)