Question
Bank Reconciliation and Entries The cash account for Brentwood Bike Co. at May 1 indicated a balance of $14,060. During May, the total cash deposited
Bank Reconciliation and Entries
The cash account for Brentwood Bike Co. at May 1 indicated a balance of $14,060. During May, the total cash deposited was $70,990 and checks written totaled $65,910. The bank statement indicated a balance of $24,070 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items:
Checks outstanding totaled $10,720.
A deposit of $8,730, representing receipts of May 31 had been made too late to appear on the bank statement.
The bank had collected for Brentwood Bike Co. $4,610 on a note left for collection. The face of the note was $4,260.
A check for $360 returned with the statement had been incorrectly charged by the bank as $630.
A check for $630 returned with the statement had been recorded by Brentwood Bike Co. as $360. The check was for the payment of an obligation to Adkins Co. on account.
Bank service charges for May amounted to $70.
A check for $1,060 from Jennings Co. was returned by the bank due to insufficient funds.
Instructions:
Question Content Area
1. Prepare a bank reconciliation as of May 31.
Cash balance according to bank statement | $fill in the blank 2a3f68ff4009061_1 | |
Add bank service chargesAdd deposit of May 31, not recorded by bankAdd error in recording checkAdd outstanding checksAdd note and interest collected by bank | $- Select - | |
Add bank error in charging check as $630 instead of $360Add bank service chargesAdd check returned because of insufficient fundsAdd note and interest collected by bankDeduct error in recording check | - Select - | - Select - |
Deduct bank service chargesDeduct check returned because of insufficient fundsDeduct deposit of May 31, not recorded by bankDeduct outstanding checksDeduct note and interest collected by bank | - Select - | |
Adjusted balance | $fill in the blank 2a3f68ff4009061_9 | |
Cash balance according to company's records | $fill in the blank 2a3f68ff4009061_10 | |
Add bank error in charging check as $630 instead of $360Add bank service chargesAdd check returned because of insufficient fundsAdd deposit of May 31, not recorded by bankAdd note and interest collected by bank | - Select - | |
Deduct bank error in charging check as $630 instead of $360Deduct check returned because of insufficient fundsDeduct deposit of May 31, not recorded by bankDeduct outstanding checksDeduct note and interest collected by bank | $- Select - | |
Deduct bank error in charging check as $630 instead of $360Deduct bank service chargesDeduct deposit of May 31, not recorded by bankDeduct outstanding checksDeduct note and interest collected by bank | - Select - | |
Deduct bank error in charging check as $630 instead of $360Deduct deposit of May 31, not recorded by bankDeduct error in recording checkDeduct outstanding checksDeduct note and interest collected by bank | - Select - | - Select - |
Adjusted balance | $fill in the blank 2a3f68ff4009061_20 |
Question Content Area
2. Journalize the necessary entries (a.) that increase cash and (b.) that decrease cash. The accounts have not been closed. If an amount box does not require an entry, leave it blank.
a. May 31 | CashCash Short and OverInterest RevenueNotes ReceivablePetty Cash | - Select - | - Select - |
CashInterest PayableInterest ReceivableNotes ReceivablePetty Cash | - Select - | - Select - | |
CashInterest RevenuePetty CashSalesUnearned Interest | - Select - | - Select - | |
b. May 31 | Accounts Payable-Adkins Co.Accounts Receivable-Adkins Co.Cash Short and OverInterest RevenueNotes Receivable | - Select - | - Select - |
Accounts Payable-Jennings Co.Accounts Receivable-Jennings Co.Interest ExpenseInterest RevenuePetty Cash | - Select - | - Select - | |
CashInterest ExpenseMiscellaneous ExpenseNotes PayableNotes Receivable | - Select - | - Select - | |
Accounts Payable-Adkins Co.Accounts Receivable-Jennings Co.CashMiscellaneous ExpenseNotes Receivable | - Select - | - Select - |
Question Content Area
3. If a balance sheet is prepared for Brentwood Bike Co. on May 31, what amount should be reported as cash? $fill in the blank eda34bfb807bfc5_1
Check My Work1 more Check My Work uses remaining.
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