Required information Problem 8-5A Preparing a bank reconciliation and recording adjustments LO P3 The following information applies to the questions displayed below.) Chavez Company most recently reconciled its bank statement and book balances of cash on August 31 and it reported two checks outstanding, No. 5888 for $1,041 and No. 5893 for $493. The following information is available for its September 30, 2017, reconciliation. From the September 30 Bank Statement PREVIOUS BALANCE 18,000 TOTAL CHECKS AND DEBITS 9,923 TOTAL DEPOSITS AND CREDITS 11.579 CURRENT BALANCE 19,656 CHECKS AND DEBITS DEPOSITS AND CREDITS Date No. Amount Date Amount 09/03 5888 1,041 09/05 1,104 09/04 5902 766 09/12 2.288 09/07 5901 1,853 09/21 4.301 09/17 626NSF 09/25 2.331 09/20 5905 993 09/30 15IN 09/22 5903 09/30 1,540CM 09/22 5904 2.127 09/28 5907 09/29 5909 1,873 210 From Chavez Company's Accounting Records Cash Receipts Deposited Cash Date Debit Sept. 5 1,104 2,288 4301 2,331 1,702 11,726 From Chavez Company's Accounting Records Cash Receipts Deposited Cash Date Debit Sept. 5 1. 104 2.288 4.301 2.331 1,702 11,726 Cash Disbursements Cash Check No. Credit 5901 1,953 5902 5903 5904 2.088 5905 5906 955 5907 210 5908 5909 1,873 9,565 993 393 Credit cash Date Explanation Aug. 31 Balance Sept. 30 Total receipts 30 Total disbursements PR R12 D23 Debit 11,726 Acct. No. 101 Balance 16,466 28.192 1 8.627 9.565 Additional Information Check No. 5904 is correctly drawn for $2,127 to pay for computer equipment; however, the recordkeeper misread the amount and entered it in the accounting records with a debit to Computer Equipment and a credit to Cash of $2,088. The NSF check shown in the statement was originally received from a customer, S. Nilson, in payment of her account. Its return has not yet been recorded by the company. The credit memorandum is from the collection of a $1,560 note for Chavez Company by the bank. The bank deducted a $20 collection fee. The collection and fee are not yet recorded. Problem 8-5A Part 2 2. Prepare the journal entries to adjust the book balance of cash to the reconciled balance. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Required: 1. Prepare the September 30, 2017, bank reconciliation for this company. $ Bank statement balance Add: Deposit of Sept. 30 CHAVEZ COMPANY Bank Reconciliation September 30, 2017 19,656 Book balance Add: [ Interest earned Proceeds of note less $20 fee S 1,702 Deduct: Check No. 5893 Check No. 5906 Check No. 5908 1,702 21,358 Deduct: NSF check [Error (check 5904) 514 955 3 93 1,862 19.496 Adjusted book balance Adjusted bank balance $ $ 0 2. Prepare the journal entries to adjust the book balance of cash to the reconciled balance. (If no entry is required for a transaction/event, select "No Journal entry required in the first account field.) View transaction list View journal entry worksheet Date General Journal Debit Credit No 2 Sept 30 Cash Interest earned 3 Sept 30 Cash Collection expense Notes receivable 5 Sept 30 Accounts receivable-S. Nilson Cash 6 Sept 30 Computer equipment Cash