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, $21,790.
2. Cash balance according to the bank statement at August 31, $23,160.
3. Checks outstanding, $4,420.
4. Deposit in transit, not recorded by bank, $3,550.
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.

Question Content Area

a. Prepare a bank reconciliation, using the format shown in Exhibit 13.

Creative Design Co. Bank Reconciliation August 31, 20Y6

Cash balance according to bank statement	blank	$fill in the blank a316d309afaa048_1
Adjustments:	blank	blank
Bank service chargeDeposit in transit, not recorded by bankError in recording checkOutstanding checks	- Select -	blank
Bank service chargeDeposit in transit, not recorded by bankError in recording checkOutstanding checks	- Select -	blank
Total adjustments	blank	fill in the blank a316d309afaa048_6
Adjusted balance	blank	$fill in the blank a316d309afaa048_7
Cash balance according to company's records	blank	$fill in the blank a316d309afaa048_8
Adjustments:	blank	blank
Bank service chargeDeposit in transit, not recorded by bankError in recording checkOutstanding checks	$- Select -	blank
Bank service chargeDeposit in transit, not recorded by bankError in recording checkOutstanding checks	- Select -	blank
Total adjustments	blank	fill in the blank a316d309afaa048_13
Adjusted balance	blank	$fill in the blank a316d309afaa048_14

Question Content Area

b. If the balance sheet were prepared for Creative Design Co. on August 31, 2016, what amount should be reported for cash? $fill in the blank fdab5b03cfc4fa9_1

c. Must a bank reconciliation always balance (reconcile)?

YesNo