Question
Bank Reconciliation and Entries The cash account for Stone Systems at July 31, 20Y5, indicated a balance of $17,750. The bank statement indicated a balance
Bank Reconciliation and Entries
The cash account for Stone Systems at July 31, 20Y5, indicated a balance of $17,750. The bank statement indicated a balance of $33,650 on July 31, 20Y5. Comparing the bank statement and the accompanying canceled checks and memos with the records reveals the following reconciling items:
Checks outstanding totaled $17,865.
A deposit of $9,150, representing receipts of July 31, had been made too late to appear on the bank statement.
The bank had collected $6,095 on a note left for collection. The face of the note was $5,750.
A check for $390 returned with the statement had been incorrectly recorded by Stone Systems as $930. The check was for the payment of an obligation to Holland Co. for the purchase of office supplies on account.
A check drawn for $1,810 had been incorrectly charged by the bank as $1,180.
Bank service charges for July amounted to $80.
Required:
1. Prepare a bank reconciliation.
Stone Systems | ||
Bank Reconciliation | ||
July 31, 20Y5 | ||
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 entry, if an amount box does not require an entry, leave it blank.
20Y5 July 31 | |||
July 31 | |||
3. If a balance sheet were prepared for Stone Systems on July 31, 20Y5, what amount should be reported as cash? $
1. Prepare a bank reconciliation Stone Systems Bank Reconciliation July 31, 20Y5 Cash balance according to bank statement Adjustments: Total adjustments Adjusted balance Cash balance according to company's records Adjustments: Total adjustments Adjusted balanceStep by Step Solution
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