Required information (The following information applies to the questions displayed below. The August bank statement and cash T-account for Martha Company follow: BANK STATEMENT Deposits Other Checks Date Aug. 1 2 $ 260 $11,400 360 230 810 270 Balance $16,610 16, 350 27,750 27, 390 27,160 26, 350 26,080 29,880 29,520 9,820 16,520 15,760 15,780 15,770 3,800 360 19,700 6,700 760 Interest earned Service charge $20 10 Balance Aug. 1 Deposits Aug. 2 Aug. 1 12 Cash (A) 16,610 Checks written 11,400 260 3,800 360 6,700 230 4,800 270 810 270 490 760 360 19,700 19,800 EWNP Aug. 31 Balance W No deposits were in transit and no checks were outstanding at the end of July. 1. Identify and list the deposits in transit at the end of August. TIP: Put a check mark beside each item that appears on both the bank statement and what's already been recorded in the accounting records (shown in the T-account). (Select all that apply.) 0 O O O $ 11,400 $ 3,800 $ 6,700 $ 4,800 2. Identify and list the outstanding checks at the end of August. (Select all that apply.) 0000000OOO $ 260 $ 360 $ 230 $ 270 $ 810 $ 270 $ 490 $ 760 $ 360 $ 19,700 O 0 O O 3.Prepare a bank reconciliation for August. TIP: Any item in the accounting records without check marks should appear on the bank statement side of the bank reconciliation. Any items in the bank statement without check marks should appear on the company's books side of the bank reconciliation. MARTHA COMPANY Bank Reconciliation At August 31 Company's Books Ending Balance per Cash Account Bank Statement Ending Balance per Bank Statement Additions: Additions: Deductions: Deductions: Up-to-Date Cash Balance Up-to-Date Cash Balance 4. Prepare any journal entries that the company should make as a result of the bank reconciliation. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list A Record the interest of $20 received from the bank. B Record the service charges of $10 deducted by the bank. C Earlier this month, a check in the amount of $19,700 was recorded as a reduction in cash. As of August 31, that check was still outstanding. Credit On August 31, a deposit of $4,800 was recorded, but the deposit was still in transit at the end of the month. Note : = journal entry has been entered Record entry Clear entry View general journal 5. After the reconciliation journal entries are posted, what balance will be reflected in the Cash account in the ledger? 6. If the company also has $90 of petty cash on hand, which is recorded in a different account called Petty Cash on Hand, what total amount of Cash and Cash Equivalents should be reported on the August 31 balance sheet? 5. Balance in Cash Accounts Total Amount of Cash and Cash Equivalents 6
