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Evan Knight operates a roller skating center. He has just received the monthly bank statement at January 31 from Citizen National Bank, and the statement
Evan Knight operates a roller skating center. He has just received the monthly bank statement at January 31 from Citizen National Bank, and the statement shows an $10 charge for printed checks. In reviewing his cash records, Knight identifies outstanding checks totaling $606 and a January 31 deposit in transit of $1,775 During January, he recorded a $310 check for the salary of a part-time employee ending balance of $725. Listed on the statement are an EFT rent collection of $325 a service charge of $9, two NSF checks totaling $110, and a $31. Knight's Cash account shows a January 31 balance of $1,977 as. (Click the icon to view the bank reconciliation.) Requirement 1. Use the bank reconciliation provided to make the journal entries that Knight should record on January 31 to update his Cash account. Include an explanation for each entry. (Record the transactions in the order they appear on the bank reconciliation. Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Journal Entry Date Accounts and Explanations Debit Credit Jan 31 BANK: Balance, January 31 725 1,775 Add: Deposit in transit 2,500 (606) Less: Outstanding checks $ 1,894 Adjusted bank balance BOOKS: Balance, January 31 1,977 325 Add: EFT collection -rent 2,302 Less: Correction of book error 279 NSF checks 110 Charge for printed checks 10 (408) Service charge $ 1,894 Adjusted book balance
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