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cash account for American Medical Co. at April 30 indicated a balance of $334,985. The bank statement indicated a balance of $388,600 on April 30.
cash account for American Medical Co. at April 30 indicated a balance of $334,985. The bank statement indicated a balance of $388,600 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:
A. | Checks outstanding totaled $61,280. |
B. | A deposit of $42,500, representing receipts of April 30, had been made too late to appear on the bank statement. |
C. | The bank collected $42,000 on a $40,000 note, including interest of $2,000. |
D. | A check for $7,600 returned with the statement had been incorrectly recorded by American Medical Co. as $760. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account. |
E. | A check drawn for $240 had been erroneously charged by the bank as $420. |
F. | Bank service charges for April amounted to $145. |
Instructions | |
1. | Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. Deduct: or Add: will automatically appear if it is required. |
2. | Journalize the necessary entries. The accounts have not been closed. Refer to the Chart of Accounts for exact wording of account titles. |
3. | If a balance sheet is prepared for American Medical Co. on April 30, what amount should be reported as cash? |
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