Question
Pelzer Company reconciled its bank and book statement balances of Cash on August 31 and showed two cheques outstanding at that time, #5888 for $6,310
Pelzer Company reconciled its bank and book statement balances of Cash on August 31 and showed two cheques outstanding at that time, #5888 for $6,310 and #5893 for $1,508.00. The following information was available for the September 30, 2020, reconciliation: From the September 30, 2020, bank statement:
Balance of previous statement on Aug. 31/20 | 10,835.00 | |
6 deposits and other credits totalling | 23,009.00 | |
9 cheques and other debits totalling | 26,946.00 | |
Current balance as of Sept. 30/20 | 6,898.00 | |
Chequing Account Transactions | |||||||||||
Date | Amount | Transaction Description | Date | Amount | Transaction Description | ||||||
Sept. | 05 | 5,728.00 | + Deposit | Sept. 25 | 4,292.00 | + Deposit | |||||
12 | 2,601.00 | + Deposit | 30 | 50.00 | + Interest | ||||||
17 | 787.45 | NSF cheque | 30 | 3,510.00 | + Credit memo | ||||||
21 | 6,533.00 | + Deposit |
Date | Cheque No. | Amount | Date | Cheque No. | Amount | |||||
Sept. | 03 | 5904 | 9,340.55 | Sept. 22 | 5888 | 6,310.00 | ||||
07 | 5901 | 1,455.00 | 24 | 5909 | 2,389.00 | |||||
08 | 5905 | 378.00 | 28 | 5907 | 3,712.00 | |||||
10 | 5903 | 1,474.00 | 29 | 5902 | 1,100.00 | |||||
From Pelzer Companys accounting records:
Cash | Acct. No. 101 | ||||||||
Date | Explanation | PR | Debit | Credit | Balance | ||||
2020 | |||||||||
Aug. | 31 | Balance | 3,312.00 | ||||||
Sept. | 30 | CR12 | 22,318.00 | 25,630.00 | |||||
30 | CD23 | 16,204.55 | 9,425.45 | ||||||
Deposits Made | |||||
Sept. | 5 | $ | 5,728.00 | ||
12 | 2,601.00 | ||||
21 | 6,533.00 | ||||
25 | 4,292.00 | ||||
30 | 3,164.00 | ||||
Total Sept. Cash Receipts | $ | 22,318.00 | |||
Cheques Written | |||||
No. | 5901 | $ | 1,455.00 | ||
5902 | 1,100.00 | ||||
5903 | 1,474.00 | ||||
5904 | 3,940.55 | ||||
5905 | 378.00 | ||||
5906 | 800.00 | ||||
5907 | 3,712.00 | ||||
5908 | 956.00 | ||||
5909 | 2,389.00 | ||||
Total Sept. Cash Disbursements | $ | 16,204.55 | |||
- Cheque #5904 was correctly written for $9,340.55 to pay for computer equipment; however, the bookkeeper misread the amount and entered it in the accounting records with a debit to Computer Equipment and a credit to Cash as though it were for $3,940.55. The NSF cheque was originally received from a customer, Lisa Willis, in payment of her account. Its return was not recorded when the bank first notified the company.
- The credit memo resulted from an electronic fund transfer of $3,560 for a customer payment. The bank had deducted a $50.00 bank service charge. The collection has not been recorded.
Required: 1. Prepare a September 30 bank reconciliation for the company. (Round your answers to 2 decimal places.)
2. Prepare the General Journal entries needed to adjust the book balance of cash to the reconciled balance. (Round your answers to 2 decimal places.)
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