Crane Company is a very profitable small business. It has not, however, given much consideration to internal control. For example, in an attempt to keep clerical and office expenses to a minimum, the company has combined the jobs of cashier and bookkeeper. As a result, Bret Turrin handles all cash receipts, keeps the accounting records, and prepares the monthly bank reconciliations. The balance per the bank statement on October 31, 2017, was $18,263.00. Outstanding checks were No. 62 for $154.00, No. 183 for $173.00, No. 284 for $253.00, No. 862 for $219.00, No. 863 for $271.00, and No. 864 for $178.00. Included with the statement was a credit memorandum of $236.00 indicating the collection of a note receivable for Crane Company by the bank on October 25. This memorandum has not been recorded by Crane. The companys ledger showed one Cash account with a balance of $22,039.00. The balance included undeposited cash on hand. Because of the lack of internal controls, Bret took for personal use all of the undeposited receipts in excess of $4,008.00. He then prepared the following bank reconciliation in an effort to conceal his theft of cash.

Cash balance per books, October 31				$22,039.00
Add: Outstanding checks
No. 862		$219.00
No. 863		271.00
No. 864		178.00		468.00
				22,507.00
Less: Undeposited receipts				4,008.00
Unadjusted balance per bank, October 31				18,499.00
Less: Bank credit memorandum				236.00
Cash balance per bank statement, October 31				$18,263.00

(a) Prepare a correct bank reconciliation. (Hint: Deduct the amount of the theft from the adjusted balance per books.) (List items that increase balance as per bank & books first.)

(a) Prepare a correct bank reconciliation. (Hint: Deduct the amount of the theft from the adjusted balance per books.) (List items that increase balance as per bank & books first.) CRANE COMPANY Bank Reconciliation October 31, 2017 $ Balance per bank statement 18,263 Add 4008.00 i Undeposited receipts 22271 Less Outstanding checks No. 62 154 i 173 No. 183 253 i No. 284 No. 862 219 i 271i No. 863 No. 864 i 178 1248 Adjusted balance per bank 21023 Cash balance per books 22039 No. 862 219 No. 863 271 No. 864 178 i 1248 21023 Adjusted balance per bank Cash balance per books 22039 Add Bank credit (collection of note receivable) 236 Adjusted balance per books (before theft) 22,275 Less Theft 4008 $ Theft 18267 eTextbook and Media Attempts: 9 of 10 used Save for Later Check