Bank Reconciliation and Entries

The cash account for Deaver Consulting at October 31, 20Y6, indicated a balance of $15,750. The bank statement indicated a balance of $31,095 on October 31, 20Y6. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:

1. Checks outstanding totaled $10,125.
2. A deposit of $4,120, representing receipts from October 31, had been made too late to appear on the bank statement.
3. The bank had collected $10,400 on a note left for collection. The face of the note was $10,000.
4. A check for $1,200 returned with the statement had been incorrectly recorded by Deaver Consulting as $120. The check was for the payment of an obligation to Oxford Office Supplies Co. for the purchase of office supplies on account.
5. A check drawn for $320 had been incorrectly charged by the bank as $230.
6. Bank service charges for October amounted to $70.

Instructions:

Question Content Area

2. Illustrate the effects on the accounts and financial statements of the bank reconciliation. If no account or activity is affected, select "No effect" from the dropdown and leave the corresponding number entry box blank. Enter account decreases and cash outflows as negative amounts.

Increases to Cash:

		Balance Sheet
		Assets			=	Liabilities	+	Stockholders' Equity
		Accounts PayableCashNo EffectCash	+	Accounts ReceivableNotes ReceivableNo EffectNotes Receivable	=	Accounts PayableNotes PayableNo EffectNo Effect	+	Capital StockRetained EarningsNo EffectRetained Earnings
	Oct. 31.			f		fill in the blank 8df471f87068015_7		fill in the blank 8df471f87068015_8
	Statement of Cash Flows					Income Statement
	FinancingInvestingOperatingNo effectOperating	fill in the blank 8df471f87068015_10				CashCost of merchandise soldInterest revenueNo effectInterest revenue		fill in the blank 8df471f87068015_12

Decreases to Cash:

		Balance Sheet
		Assets			=	Liabilities	+	Stockholders' Equity
		CashAccounts PayableNo EffectCash	+	Accounts ReceivableNotes ReceivableNo EffectNo Effect	=	Accounts PayableNotes PayableNo EffectAccounts Payable	+	Capital StockRetained EarningsNo EffectRetained Earnings
	Oct. 31.	fill in the blank 8df471f87068015_17		fill in the blank 8df471f87068015_18		fill in the blank 8df471f87068015_19		fill in the blank 8df471f87068015_20
	Statement of Cash Flows					Income Statement
	FinancingInvestingOperatingNo effectOperating	fill in the blank 8df471f87068015_22				Accounts payableCost of merchandise soldMiscellaneous administrative expenseNo effectMiscellaneous administrative expense		fill in the blank 8df471f87068015_24