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Problem 5-5 - At the end of August 20x9, Carver Communications had a cash balance of $4,875 on the books. The bank statement they received
Problem 5-5 - At the end of August 20x9, Carver Communications had a cash balance of $4,875 on the books. The bank statement they received shows a balance of $7,379. When the controller at Carver compared the bank statement and the company's cash account, the following items were noted: 1. The bank statement included monthly service charges of $45. 2. Cash sales of $468 were recorded by Carver on August 18th in their records and on the deposit slip. However, when the bank reviewed the deposit, the correct amount was $486 and credited Carver's account for this correct amount. 3. Two customers remitted payments on their accounts via direct deposit to Carver's account. These two items appeared on the bank statement: i. R. Livy $1,257 ii. P. Scale $899 4. Outstanding cheques at July 31, 20x9 totaled $3,350. Of this, $2,900 cleared during August 5. Cheques written in August which have not cleared at August 31st total $985. 6. On August 21st, Carver issued cheque #145 for $950 to a creditor as a payment in full on their account. Carver incorrectly posted the journal entry for $905. 7. Included with the bank statement was a customer's returned cheque (NSF). The cheque was for $330. The bank also charged Carver a $25 processing fee. 8. The August bank statement did not include a deposit of $660 which was placed in the overnight deposit drop box by Carver on August 31st. Required - a. Prepare any adjusting journal entries required to adjust the cash balance. Calculate the adjusted cash balance. Prepare the bank reconciliation for Carver Communications at August 20x9. b
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