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Bank Reconciliation The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6: 1. Cash balance according

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Bank Reconciliation The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6: 1. Cash balance according to the company's records at August 31, $24,770. 2. Cash balance according to the bank statement at August 31, $26,260. 3. Checks outstanding, $5,030. 4. Deposit in transit, not recorded by bank, $4,040. 5. A check for $170 in payment of an account was erroneously recorded in the check register as $710. 6. Bank debit memo for service charges, $40. a. Prepare a bank reconciliation, using the format shown in Exhibit 13. Creative Design Co. Bank Reconciliation August 31, 2016 Cash balance according to bank statement 27,770 X Add: Deposit in transit on August 31 13,325 x Deduct: Outstanding checks V Adjusted balance Cash balance according to company's rebords Add: Error in recording check Deducti Bank service charge Adjusted balance 25.390 X 44.235 X b. If the balance sheet were prepared for Creative Design Co. on August 31, what amount should be reported for cash? c. Must a bank reconciliation always balance (reconcile)? Yes

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