Question (1): 7 Marks

On March 31, 2020 Amman Company had a cash balance per books of JOD 10,985.20. The bank statement from Arab Bank on that date showed a balance of JOD 10,608.30. A comparison of the statement with the cash amount revealed the following situations.

1. On March 16, cash sales of JD 3891 were deposited in the bank, and Amman companys account was credited with that correct amount by the bank. However, the cash receipts journal entry and the deposit slip were erroneously made for JD 3981

2. Deposits in transit totaled JD 3,910.15

3. On March 31, outstanding checks totaled JD 925.25

4. On March 31, the bank collected a note receivable with the amount of JD 3130 on companys behalf plus JD 50 interest. The bank charged a collection fee of JD 32. No interest has been accrued on the note

5. On March 19, check No. 00121 for JD 1945 was issued by Amman Company to Al-Arab Company on account. The check, which cleared the bank in March, was erroneously journalized and posted by Amman Company for JD 1495

Instructions:

Prepare a correct bank reconciliation based on the above information.

Answer Q (1):

Amman Company Bank Reconciliation March 31, 2020
Cash balance per bank statement	JD 10,608.30
Adjusted Cash balance per bank
Cash balance per books	JD 10,985.20
Adjusted Cash balance per books

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