On August 31, 2019, the balance in the checkbook and the Cash account of the Dry Creek Bed and Breakfast was $12,327. The balance shown on the bank statement on the same date was $13,222.

Notes

The firms records indicate that a $1,500 deposit dated August 30 and a $706 deposit dated August 31 do not appear on the bank statement.

A service charge of $9 and a debit memorandum of $345 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,	$	115
Check 713,	$	130
Check 716,	$	243
Check 736,	$	582
Check 739,	$	83
Check 741,	$	125

A credit memorandum shows that the bank collected a $2,109 note receivable and interest of $68 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?

Complete this question by entering your answers in the tabs below.

Bank Rec

General Journal

Analyze

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

DRY CREEK BED AND BREAKFAST
Bank Reconciliation Statement
August 31, 2019
Balance on bank statement
Additions:
Deductions:
Total deductions
Adjusted bank balance
Balance in books
Additions:
Deductions:
Adjusted book balance

Bank Rec

Journal entry worksheet

Record the deposit in transit.

Note: Enter debits before credits.

Record the bank service fee.

Date	General Journal	Debit	Credit
Aug 31, 2019

Record the bank service fee.

Note: Enter debits before credits.

Date	General Journal	Debit	Credit
Aug 31, 2019

Record the returned check.

Note: Enter debits before credits.

Date	General Journal	Debit	Credit
Aug 31, 2019

Record the outstanding checks.

Note: Enter debits before credits.

Date	General Journal	Debit	Credit
Aug 31, 2019

Record the note collected by the bank plus interest.

Note: Enter debits before credits.

Date	General Journal	Debit	Credit
Aug 31, 2019

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

Net effect

by

G