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, $26,810.
2. Cash balance according to the bank statement at August 31, $28,390.
3. Checks outstanding, $5,440.
4. Deposit in transit, not recorded by bank, $4,370.
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, $30.

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 e5fea6fd8033fd3_1
Add: Deposit in transit on August 31	$	fill in the blank e5fea6fd8033fd3_3
Deduct: Outstanding checks		fill in the blank e5fea6fd8033fd3_5
Adjusted balance		$fill in the blank e5fea6fd8033fd3_6
Cash balance according to company's records		$fill in the blank e5fea6fd8033fd3_7
Add: Error in recording check		fill in the blank e5fea6fd8033fd3_9
Deduct: Bank service charge		fill in the blank e5fea6fd8033fd3_11
Adjusted balance		$fill in the blank e5fea6fd8033fd3_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 1ee224f8606a002_1

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