Part Six: Problem

At December 31 the cash balance per books of Heinisch Company was $12,485.20, and the cash balance per the bank statement was $20,154.30. The bank did not make any errors, but two errors were made by Heinisch Company.

The December bank statement for Heinisch Company showed the following checks and deposits.

Bank Statement

Checks Deposits

Date Number Amount Date Amount

12-7 3472 1,426.80 12-4 1,211.60

12-4 3474 1,640.70 12-16 2,672.70

12-8 3475 1,300.00 12-21 2,954.00

12-31 3479 450.80 12-30 1,025.00

The cash records per books for December showed the following cash payments and receipts.

Cash Payments Cash deposited

Date Check Number Amount Date Amount

12-1 3471 720.10 12-3 $1,211.60

12-1 3472 1,426.80 12-15 2,672.70

12-1 3473 1,050.00 12-20 2,945.00

12-1 3474 1,640.70 12-30 1,025.00

12-2 3475 1,300.00 12-31 1,190.40

12-4 3476 621.30

12-17 3477 807.40

12-23 3478 798.00

12-24 3479 540.80

12-30 3480 1,889.50

In addition, the bank statement contains the following items:

1. The collection of a $3,500 note and $145 of interest less a collection fee of $20 from a customer of Heinisch Company.

2. A NSF check of $725.80 written by D. Chagnon, a customer. At December 31, the check had not been redeposited in the bank.

3. Bank service charge of $25.

Required:

1. Prepare bank reconciliation at December 31.

2. Prepare the required journal entries based on the reconciliation. Omit explanations.

Date	Accounts Title and Explanation	Ref.	Debit	Credit