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 $1,091 and No. 5893 for $491. Check No. 5893 was still outstanding as of September 30. The following information is available for its September 30 reconciliation. From the September 30 Bank Statement PREVIOUS BALANCE 18,000 TOTAL CHECKS AND DEBITS 9,993 TOTAL DEPOSITS AND CREDITS 11,369 CURRENT BALANCE 19,376 CHECKS AND DEBITS DEPOSITS AND CREDITS Date No. Amount Date Amount 09/03 5888 1,091 09/05 1,114 09/04 5902 748 09/12 2,269 09/07 5901 1,887 09/21 4,017 09/17 619 NSF 09/25 2,374 09/20 5905 950 09/30 15 IN 09/22 5903 448 09/30 1,580 CM 09/22 5904 2,147 09/28 09/29 5907 249 5909 1,854 From Chavez Company's Accounting Records Cash Receipts Deposited Cash Date Debit Sept. 5 1,114 12 2,269 21 4,017 25 2,374 30 1,741 11,515 Cash Payments Cash Check No. Credit 5901 1,887 5902 748 5903 448 5904 2,105 5905 950 5906 1,010 5907 249 5908 372 5909 1,854 9,623 Date Cash Explanation Acct. No. 101 PR Debit Credit Balance Aug. 31 Balance 16,418 Sept. 30 Total receipts 30 Total payments R12 D23 11,515 27,933 9,623 18,310 Additional Information (a) Check No. 5904 is correctly drawn for $2,147 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 $2,105. (b) 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. (c) The credit memorandum (CM) is from the collection of a $1,580 note for Chavez Company by the bank. The collection is not yet recorded. Problem 8-5A Part 1 Required: 1. Prepare the September 30 bank reconciliation for this company. Bank statement balance Add: CHAVEZ COMPANY Bank Reconciliation September 30 Book balance Add: Deduct: Deduct