1. 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, $25,520.
   2. Cash balance according to the bank statement at August 31, $26,850.
   3. Checks outstanding, $5,180.
   4. Deposit in transit, not recorded by bank, $4,160.
   5. A check for $480 in payment of an account was erroneously recorded in the check register as $840.
   6. Bank debit memo for service charges, $50.

   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		$fill in the blank 91a72bf8603a038_1
   Add: Bank service chargeAdd: Deposit in transit on August 31Add: Error in recording checkAdd: Outstanding checks		- Select -
   Deduct: Bank service chargeDeduct: Deposit in transit on August 31Deduct: Error in recording checkDeduct: Outstanding checks		- Select -
   Adjusted balance		$fill in the blank 91a72bf8603a038_6
   Cash balance according to company's records		$fill in the blank 91a72bf8603a038_7
   Add: Bank service chargeAdd: Deposit in transit on August 31Add: Error in recording checkAdd: Outstanding checks		- Select -
   Deduct: Bank service chargeDeduct: Deposit in transit on August 31Deduct: Error in recording checkDeduct: Outstanding checks		- Select -
   Adjusted balance		$fill in the blank 91a72bf8603a038_12

   b. If the balance sheet were prepared for Creative Design Co. on August 31, what amount should be reported for cash? $fill in the blank d7905f04f02c075_1

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

   YesNo