LO5 P7-5B. Bank Reconciliation The bank reconciliation made by Adam Company, a sole proprietorship, on March 31 showed a deposit in transit of $1,300 and two outstanding checks, No. 797 for $550 and No. 804 for $690. The reconciled cash balance on March 31 was $12,020, The following bank statement is available for April 30: Bank Statement TO Adam Company Fairbanks, AK Date Deposits April 30 FAIRBANKS NATIONAL BANK No. Date Charges Date Balance 31 ... 1...... 808 13...... 13 13. Apr. $1,300 804 3. 1,680 807 7. .... 1,250 1,020 809 18 840 810 23. 990 811 27 1,340 813 30 1,160 814 30 95IN NSF SC Item Codes: EC: Error Correction SC: Service Charge IN: Interest Earned Mar. $11,960 Apr. 2...... $ 690 Apr. 1 13,260 3 730 2 12,570 7 1,240 3 13,520 7 838 7 12,692 541 13,171 16 1,040 16 12,131 18 500 18 12,471 23 600 23 12,861 27 640 27. 13,561 30 40 30 14,776 DM: Debit Memo CM: Credit Memo OD: Overdraft RT: Returned Item NSF: Non-sufficient Funds ..... A list of deposits made and checks written during April is shown below: Chapter 7 Internal Control and Cash Deposits Made 365 Apr. 2. 6 10 17 22 24 29 30 Checks Written $1,680 No.B07 1.250 808 1.020 809 840 810 990 811 1,340 812 1,160 813 1,425 814 815 $9,705 816 $ 730 1,240 838 1,040 451 948 640 600 372 875 $7,734 The Cash in Bank account balance on April 30 was $13,991. In reviewing checks returned by the bank. the accountant discovered that check No. 811 written for $541 for delivery expense, was recorded in the cash disbursements journal as $451. The NSF check for $500 was that of customer R. Koppa, deposited in April. Interest for April added to the account by the bank was $95. Required a. Prepare a bank reconciliation for Adam Company at April 30. b. Prepare the necessary journal entries to bring the Cash in Bank account into agreement with the reconciled cash balance on the bank reconciliation