Bank Reconciliation and Entries The cash account for American Medical Co. at April 30 indicated a balance of $13,180. The bank statement indicated a balance of $15,140 on April 30. Comparing the bank statement and the accompanying anceled checks and memos with the records revealed the following reconciling items: a. Checks outstanding totaled $5,450. b. A deposit of $5,680, representing receipts of April 30, had been made too late to appear on the bank statement. c. The bank collected $2,950 on a $2,800 note, including interest of $150. d. A check for $880 returned with the statement had been incorrectly recorded by American Medical Co. as $800. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account. e. A check drawn for $70 had been erroneously charged by the bank as $700. f. Bank service charges for April amounted to $50. Required: 1. Prepare a bank reconciliation. American Medical Co. Bank Reconciliation April 30 Cash balance according to bank statement 15,140 5,680 630 Add error in recording check 6,310 5,450 Deduct outstanding checks 6,000 Adjusted balance 13,180 Cash balance according to company's records 2,950 Deduct error in recording check 80 50 130 Deduct bank service charges 16,000 Adjusted balance Add note and interest collected by bank 5,680 Add error in recording check 630 6,310 Deduct outstanding checks 5,450 Adjusted balance 16,000 Cash balance according to company's records 13,180 2,950 Deduct error in recording check Deduct bank service charges 50 130 16,000 Adjusted balance 2. Journalize the necessary entries (a.) that increase cash and (b.) that decrease cash. The accounts have not been closed. For a compound transaction, if an amount box does not require an entry, leave it blank a. Apri 30 b. April 30 If a balance sheet is prepared for American Medical Co. on April 30, what amount should be reported as cash? 3