Problem $5$ The following information is available for Abdul Saleem, Inc., as of May $31$:

$($a$)$ Cash on the books as of May $31$ amounted to $$42,754\mathrm{.}16.$ Cash on the bank statement for the same date was $$52,351\mathrm{.}46.$

$($b$)$ A deposit of $$5,220\mathrm{.}94,$ representing cash receipts of May $31,$ did not appear on the bank statement.

$($c$)$ Outstanding checks totaled $$3,936\mathrm{.}80.$

$($d$)$ A check for $$1,920\mathrm{.}00$ retur$4$ned with the statement was recorded incorrectly in the check register as $$1,380\mathrm{.}00.$ The check was for a cash purchase of merchandise.

$($e$)$ The bank service charge for May amounted to $$25.$

$($f$)$ The bank collected $$12,240\mathrm{.}00$ for Abdul Saleem, Inc., on a note. The face value of the note was $$12,000\mathrm{.}00.$

$($g$)$ An NSF check for $$183\mathrm{.}56$ from a customer, Ann Greeno, was returned with the statement.

$($h$)$ The bank mistakenly charged to the company account a check for $$850\mathrm{.}00$ drawn by another company.

$($i$)$ The bank reported that it had credited the account for $$240\mathrm{.}00$ in interest on the average balance for May.

Instructions:

$($a$)$ Prepare a bank reconciliation for Abdul Saleem, Inc., as of May $31.$

$($b$)$ Prepare the entries in journal form necessary to adjust the accounts.

$($c$)$ What amount of cash should appear on Abdul Saleem, Inc.$\text{'}$s balance sheet as of May $31?$

$($d$)$ User Insight: Why is a bank reconciliation considered an important control over cash?