Bank Reconciliation and Entries

The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $12,415. The bank statement indicated a balance of $14,490 on June 30, 20Y1. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:

1. Checks outstanding totaled $5,220.
2. A deposit of $5,430, representing receipts of June 30, had been made too late to appear on the bank statement.
3. The bank collected $2,830 on a $2,680 note, including interest of $150.
4. A check for $770 returned with the statement had been incorrectly recorded by Pala Medical Co. as $700. The check was for the payment of an obligation to Skyline Supply Co. for a purchase on account.
5. A check drawn for $50 had been erroneously charged by the bank as $500.
6. Bank service charges for June amounted to $25.

1. Prepare a bank reconciliation. Pala Medical Co. Bank Reconciliation June 30, 20Y1 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, 20Y1, what amount should be reported as cash