Bank Reconciliation and Entries

Sunshine Interiors deposits all cash receipts each Wednesday and Friday in a night depository, after banking hours. The data required to reconcile the bank statement as of July 31, 20Y0, have been taken from various documents and records and are reproduced as follows. The sources of the data are printed in capital letters. All checks were written for payments on account.

1. Prepare a bank reconcilliation as of July 31, 20Y0. If errors in recording deposits or checks are discovered, assume that the errors were made by the company. Assume that all deposits are from cash sales. All checks are written to satisfy accounts payable. When required, enter amounts in dollars and cents.

CASH ACCOUNT: $9,576.00 6,466.42 Balance as of July 1 CASH RECEIPTS FOR MONTH OF JULY DUPLICATE DEPOSIT TICKETS: Date and amount of each deposit in July Date Amount Date July 2 $569.50 July 12 5 701.80 16 Amount Date Amount $580.70 $714.45 July 23 26 600.10 9 819.24 601.50 1,177.87 19 201.26 31 Check No. Amount 628 $837.70 329.90 629 CHECKS WRITTEN: Number and amount of each check issued in July: Check No. Amount Check No. Amount 614 $243.50 621 $309.50 515 350.10 622 Void 616 279.90 623 Void 617 395.50 624 707.01 618 435.40 625 158.63 619 320.10 626 550.03 620 238.87 627 371.73 630 882.80 631 1,081.56 632 325,40 633 310.08 634 241.71 Total amount of checks issued in July $8,369.42 BANK RECONCILIATION FOR PRECEDING MONTH: $9,420.70 $780.80 Sunshine Interiors Bank Reconciliation June 30, 20YO Cash balance according to bank statement Add: Deposit of June 30 not recorded by bank Deduct: Outstanding Check No. 580 Outstanding Check No. 602 Outstanding Check No. 612 Outstanding Check No. 613 Total deductions Adjusted balance ($310.10) (85.50) (92.50) (137.40) (625.50) $9,576.00 Cash balance according to company's records Deduct: Bank service charges Adjusted balance $9,603.70 (27.70) $9,576.00 JULY BANK STATEMENT: MEMBER FDIC AMERICAN NATIONAL BANK OF DETROIT PAGE 1 ACCOUNT NUMBER FROM 7/01/2010 BALANCE DETROIT, MI 48201-2500 (313) 933-8547 TO 7/31/20Y0 9,420.70 9 DEPOSITS 20 WITHDRAWALS SUNSHINE INTERIORS 4 OTHER DEBITS AND CREDITS NEW BALANCE CHECKS AND OTHER DEBITS DEPOSITS DATE No. 580 310.10 6,096.35 7,655.74 3,749.00CR 11,610.31 BALANCE 9,798,90 10,039,40 10,111.20 10,099.54 10,121.27 No. 612 92.50 780.80 No. 602 85.50 569.50 No, 614 No. 616 243.50 279.90 07/01 07/03 07/06 07/11 No. 615 350.10 No. 617 395.50 No. 618 435,40 701.80 B19.24 580.70 No. 619 320.10 No. 620 238.87 07/13 No. 621 309.50 No. 624 707.01 MS 4,000.00 07/14 13,104.76 No. 626 550.03 MS 160.00 07/14 12,556.10 No. 625 No. 627 158.63 317.73 No. 629 329.90 600.10 No. 630 882.80 No. 631 NSF 375.00 1,081.56 241.71 07/17 07/20 07/21 12,508.57 10,169.21 10,303.36 No. 632 325.40 No. 634 701.26 741.45 601.50 07/24 07/28 07/31 11,044.81 11,646.31 11,610.31 SC 36.00 EC ERROR CORRECTION OD -- OVERDRAFT MS -- MISCELLANEOUS PS PAYMENT STOPPED NSF -- NOT SUFFICIENT FUNDS SO-SERVICE CHARGE THE RECONCILEMENT OF THIS STATEMENT WITH YOUR RECORDS IS ESSENTIAL. ANY ERROR OR EXCEPTION SHOULD BE REPORTED IMMEDIATELY 11.610.31 Sunshine Interiors Bank Reconciliation July 31, 2040 Cash balance according to bank statement Add: Deposit in transit on July 31 Deduct: Outstanding Check no. 613 Deduct: Outstanding Check No. 628 Deduct: Outstanding Check No. 633 1.177.87 -137.40 -837.70 310.08 Total deductions 1.285.18 Adjusted balance 11,503 Cash balance according to company's records Add: Note collected by bank, including $160.00 interest Add: Error in recording July 23 deposit Add: Error in recording Check No. 627 714.45 X Total additions Deduct: Check returned because of insufficient funds 375 Deduct: Bank service charges Total deductions Adjusted balance 2. Journalize the necessary entries (a.) that increase cash and (b.) that decrease cash. The accounts have Cash a. 20Y0 July 31 Notes Receivable Interest Revenue Sales Accounts Payable b. July 31 Accounts Receivable Miscellaneous Expense III Cash 3. What is the amount of cash that should appear on the balance sheet as of July 31, 20YO? 4. Assume that a canceled check for $160 has been incorrectly recorded by the bank as $1,600. Select Treatment Addition to cash per bank statement To correct Request that the bank correct the error