Bank Reconciliation

Firebird Corp. prepares monthly bank reconciliations of its checking account balance. The bank statement for February indicated the following:

Balance, February 28	$87,692
Service charge for February	100
Interest earned during February	900
NSF check from Valerie Corp. (deposited by Firebird)	620
Note ($12,000) and interest ($350) collected from a customer of Firebirds	12,350

Upon receiving the bank statement, Firebird's accountants analyzed its cash transactions for possible reconciling items between its cash balance per books and the bank statement:

Checking account balance per Firebirds books	$73,550
Outstanding checks as of February 28	6,440
Deposit in transit at February 28	4,810
Error in recording check 7853 issued by Firebird	18

The correct amount of check 7853 is $897. It was recorded as a cash disbursement of $879 by mistake. The check was issued to pay for merchandise purchases. The check appeared on the bank statement correctly.

Required:

Question Content Area

1. Prepare a bank reconciliation schedule in proper form at February 28.

Cash balance from bank statement		$fill in the blank a09575fee013fe0_1
Add:
Deposit in transitInterest earned during FebruaryNSF checkOutstanding checksRecording error		- Select -
Less:
Deposit in transitInterest earned during FebruaryNSF checkOutstanding checksRecording error		- Select -
Adjusted cash balance		$fill in the blank a09575fee013fe0_6
blank	blank	blank
Cash balance from company records		$fill in the blank a09575fee013fe0_7
Add:
Deposit in transitInterest earned during FebruaryNSF checkOutstanding checksService charge	$- Select -
Deposit in transitNote and interest collectedNSF checkOutstanding checksService charge	- Select -	- Select -
Less:
Deposit in transitInterest earned during FebruaryNote and interest collectedOutstanding checksRecording error	$- Select -
Deposit in transitInterest earned during FebruaryNote and interest collectedOutstanding checksService charge	- Select -
Deposit in transitInterest earned during FebruaryNote and interest collectedNSF checkOutstanding checks	- Select -	- Select -
Adjusted cash balance		$fill in the blank a09575fee013fe0_20

Feedback Area

Feedback

Bank reconciliation is the process of comparing the accounting records and the bank statement, determining where discrepancies occur, and accounting for them.

Question Content Area

2. What is the amount of cash that should be reported on the February 28 balance sheet?

Amount of cash reported on the February 28 balance sheet $fill in the blank dfbcb5f7efdc035_1