P7.7B(LO4) APThe Agricultural Genetics Company's Cash account in its general ledger reported a balance of $6,782 on May 31, 2021. The company's bank statement from Western Bank reported a balance of $6,405 on the same date. Prepare bank reconciliation and related entries. A comparison of the details in the bank statement with the details in the Cash account revealed the following facts. 1. The bank statement included a debit memo of $40 for bank service charges. 2. Cash sales of $836 on May 18 were deposited in the bank. The journal entry to record the cash sales and the deposit slip to deposit the cash were incorrectly made out for $886. The bank correctly credited Agricultural Genetics Company for the correct amount. 3. The April 30 deposit of $2,190 was included on the May bank statement. The deposit had been placed in the bank's night deposit vault on April 30. 4. The May 31 deposit of $2,416 was not included on the May bank statement. The deposit had been placed in the bank's night deposit vault on May 31. 5. Cheques #928 for $180 and #1014 for $236 were outstanding on April 30. Of these, #928 cleared the bank in May. All of the cheques written in May except for #1127 for $105 and #1195 for $235 had cleared the bank by May 31. 6. On May 18, the company issued cheque #1151 for $685 to L. Kingston, on account. The cheque, which cleared the bank in May, was incorrectly journalized and posted by Agricultural Genetics Company for $658. 7. A review of the bank statement revealed that Agricultural Genetics Company received $2,200 of electronic payments from customers on account in May. The bank had also credited the company's account with $80 of interest revenue on May 31. The bank charged a $20 collection fee. Agricultural Genetics Company had no previous notice of these amounts. 8. On May 31, the bank statement showed an NSF charge of $680 for a cheque issued by Pete Dell, a customer, to Agricultural Genetics Company on account. Instructions a.Prepare the bank reconciliation at May 31. b.Prepare the necessary adjusting entries at May 31. Taking It Further

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What would you say to the Agricultural Genetics Company's bank manager, who is concerned that the company's May 31 Cash account balance shows a different amount than the May 31 bank statement?