Bank Reconciliation and Entries The cash account for Pala Medical Co. at June 30, 2001, indicated a balance of $8,870. The bank statement indicated a balance of $10,080 on June 30, 2001. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items: a. Checks outstanding totaled $3,630. b. A deposit of $3,780, representing receipts of June 30, had been made too late to appear on the bank statement. c. The bank collected $1,970 on a $1,860 note, including interest of $110. d. A check for $550 returned with the statement had been incorrectly recorded by Pala Medical Co. as $500. The check was for the payment of an obligation to Skyline Supply Co. for a purchase on account. e. A check drawn for $60 had been erroneously charged by the bank as $600. f. Bank service charges for June amounted to $20. Required: 1. Prepare a bank reconciliation. Pala Medical Co. Bank Reconciliation June 30, 2011 Cash balance according to bank statement Adjustments: $ Total adjustments Adjusted balance Cash balance according to company's records Adjustments: Total adjustments 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. 2011 June 30 b. June 30 3. If a balance sheet were prepared for Pala Medical Co. on June 30, 2011, what amount should be reported as cash? 5