Problem 1

The Fitzgerald Company maintains a checking account at the Bank of the North. The bank provides a bank statement along with canceled checks on the last day of each month. The October 31, 2021, bank statement included the following information:

Balance, October 1, 2021	$	32,690
Deposits		86,000
Checks processed		(75,200	)
Service charges		(350	)
NSF checks		(1,600	)
Monthly loan payment deducted
directly by bank from account
(includes $400 in interest)		(3,400	)
Balance, October 31, 2021	$	38,140

The companys general ledger cash (checking) account had a balance of $42,544 at the end of October. Deposits outstanding totaled $4,224, and all checks written by the company were processed by the bank except for those totaling $5,620. In addition, a check for $500 for the purchase of office furniture was incorrectly recorded by the company as a $50 disbursement. The bank correctly processed the check during October. Required: 1. Prepare a bank reconciliation for the month of October (both for bank and books). 2. Prepare the necessary journal entries at the end of October