oblem 6-1 Bank Reconciliation wing information is available to assist you in preparing a bank reconciliation for Calco LOZ The following inform Corners on May 31: The balance b. Not included A comparison bet pany records indicar balance on the May 31 bank statement is $8,432.11. tcluded on the bank statement is a $1.250 deres made by Calico Concs late on May 31. arison between the canceled checks returned with the bank statement and the com cords indicated that the following checks are outstanding at May 31: No. 123 $ 23.40 No. 127 145.00 No. 128 210.80 No. 130 8732 The Cash account on the company's books shows a balance of $9.965.34. The bank acts as a collection agency for interest came on some municipal bonds held by Calico Comers. The May bank statement indicates interest of S465.00 earned during the month. laterest earned on the checking account and added to Calico Corners' account during May S54.60. Miscellaneous bank service charges amounted to $50.00 A customer's NSF check in the amount of $166.00 was returned with the May bank statement. A comparison between the deposits listed on the bank statement and the company's books evealed that a customer's check in the amount of $123.45 was recorded on the books during May but was never added to the company's account. The bank erroneously added the check to the account of Calico Closet, which has an account at the same bank. The comparison of deposits per the bank statement with those per the books revealed that another customer's check in the amount of $101.10 was correctly added to the company's count. In recording the check on the company's books, however, the accountant errone ously increased the Cash account by $1,011.00. Required 1. Prepare a bank reconciliation in good form. 9 Record the necessary journal entries on the company's books resulting from the bank recon ciliation prepared in part (1) above. 2 A friend says to you: "I don't know why companies bother to prepare bank reconciliations it seems a waste of time. Why don't they just do like I do and adjust the Cash account for any dif ference between what the bank shows as a balance and what shows up in the books!" Explain to your friend why a bank reconciliation should be prepared as soon as a bank statement is received LOG ni Drocedures