On August 31, 2019, the balance in the checkbook and the Cash account of the Dry Creek Bed and Breakfast was $12,236. The balance shown on the bank statement on the same date was $13,172.

Notes

The firms records indicate that a $1,400 deposit dated August 30 and a $696 deposit dated August 31 do not appear on the bank statement.

A service charge of $8 and a debit memorandum of $295 covering an NSF check have not yet been entered in the firms records. (The check was issued by Art Corts, a credit customer.)

The following checks were issued but have not yet been paid by the bank:

Check 712,	$	105
Check 713,	$	120
Check 716,	$	233
Check 736,	$	572
Check 739,	$	73
Check 741,	$	115

A credit memorandum shows that the bank collected a $2,059 note receivable and interest of $58 for the firm. These amounts have not yet been entered in the firms records.

Required:

Prepare a bank reconciliation statement for the firm as of August 31.

Record general journal entries for items on the bank reconciliation statement that must be journalized.

Analyze: What effect did the journal entries recorded as a result of the bank reconciliation have on the fundamental accounting equation?

General Journal Bank Rec Analyze Prepare a bank reconciliation statement for the firm as of August DRY CREEK BED AND BREAKFAST Bank Reconciliation Statement August 31, 2019 Balance on bank statement 13,172 Additions Deposit of August 30 in transit Deposit of August 31 in transit 2,096 15,268 17,364 30,536 Deductions Check 712 Check 713 Check 716 Check 736 Check 739 Check 741 105 120 233 572 73 1,218 29,318 Total deductions Adjusted bank balance Balance in books Additions Deductions Adjusted book balance