Instructions Chart of Accounts ASSETS REVENUE The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $85,920. The bank statement indicated a balance of $127,910 on June 30, 20Y1. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items: 110 Cash 410 Sales 111 Petty Cash 610 Interest Revenue 120 Accounts Receivable 131 Notes Receivable EXPENSES A. Checks outstanding totaled $32,540. B. A deposit of $18,540, representing receipts of June 30, had been made too late to appear on the bank statement 141 Merchandise Inventory 510 Cost of Merchandise Sold 145 Office Supplies 515 Credit Card Expense 146 Store Supplies 516 Cash Short and Over 151 Prepaid Insurance 520 Salaries Expense C. The bank collected $29,425 on a $27,500 note, including interest of $1,925. D. A check for $1,350 returned with the statement had been incorrectly recorded by Pala Medical Co. as $135. The check was for the payment of an obligation to Skyline Supply Co. for a purchase on account. E. A check drawn for $570 had been erroneously charged by the bank as $750. F. Bank service charges for June amounted to $40. 181 Land 531 Advertising Expense 191 Office Equipment 532 Delivery Expense 533 Insurance Expense 192 Accumulated Depreciation Office Equipment 534 Office Supplies Expense Instructions 193 Store Equipment 535 Rent Expense 1. Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers 536 Repairs Expense 194 Accumulated Depreciation-Store Equipment 537 Selling Expenses use a minus sign 2. Journalize the necessary entries. Refer to the Chart of Accounts for exact wording of account titles. 3. If a balance sheet were prepared for Pala Medical Co. on June 30, 20Y1, what amount should be 538 Store Supplies Expense 561 Depreciation Expense-Office LIABILITIES 211 Accounts Payable-Skyline Supply Co. Equipment reported as cash? 221 Notes Payable 562 Depreciation Expense-Store Equipment 222 Interest Payable 231 Salaries Payable 590 Miscellaneous Expense 241 Sales Tax Payable 710 Interest Expense Amount Descriptions x Bank Reconciliation 1. Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. For minus sign those boxes in which you must enter subtracted or negative numbers use Amount Descriptions Adjusted balance Bank error in charging check as $570 instead of $750 Pala Medical Co. Bank Reconciliation Bank error in charging check as $750 instead of $570 June 30, 20Y1 Bank service charges 1 Cash balance according to bank statement 2 Adjustments: Check for $750 returned because insufficient funds 3 Deposit of June 30, not recorded by bank Error in recording check 5 Error in recording June 30 deposit 6 7 Outstanding checks Proceeds of note collected by bank, including $1,925 interest 8 Total adjustments 9 Cash balance according to company's records 10 Adjustments: 11 12 13 14 15 Journal Final Question X 2. Journalize the necessary entries. Refer to the Chart of Accounts for exact wording of account titles. 3. If a balance sheet were prepared for Pala Medical Co. on June 30, 2011, what amount should be reported as cash? $ JOURNAL ACCOUNTING EQUATIC DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES 1 2 3 4 5