Bank Reconciliation and Entries

The cash account for Stone Systems at July 31, 20Y5, indicated a balance of $8,480. The bank statement indicated a balance of $10,660 on July 31, 20Y5. Comparing the bank statement and the accompanying canceled checks and memos with the records reveals the following reconciling items:

1. Checks outstanding totaled $3,840.
2. A deposit of $4,000, representing receipts of July 31, had been made too late to appear on the bank statement.
3. The bank had collected $2,080 on a note left for collection. The face of the note was $1,970.
4. A check for $500 returned with the statement had been incorrectly recorded by Stone Systems as $550. The check was for the payment of an obligation to Holland Co. for the purchase of office supplies on account.
5. A check drawn for $300 had been incorrectly charged by the bank as $30.
6. Bank service charges for July amounted to $60.

Required:

1. Prepare a bank reconciliation.

Stone Systems
Bank Reconciliation
July 31, 20Y5
Cash balance according to bank statement
		fill in the blank 6ca78b015008fc6_3
	$fill in the blank 6ca78b015008fc6_5
	fill in the blank 6ca78b015008fc6_7
Total deductions		fill in the blank 6ca78b015008fc6_8
Adjusted balance		$fill in the blank 6ca78b015008fc6_9
Cash balance according to company's records		$fill in the blank 6ca78b015008fc6_10
Adjustments:
	$fill in the blank 6ca78b015008fc6_12
	fill in the blank 6ca78b015008fc6_14
Total additions		fill in the blank 6ca78b015008fc6_15
		fill in the blank 6ca78b015008fc6_17
Adjusted balance		$fill in the blank 6ca78b015008fc6_18

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.

2

3. If a balance sheet were prepared for Stone Systems on July 31, 20Y5, what amount should be reported as cash? $fill in the blank 5dc973fa9005076_1