Question
Rick Hall owns a card shop, Halls Cards. The following cash information is available for the month of August Year 1: As of August 31,
Rick Hall owns a card shop, Halls Cards. The following cash information is available for the month of August Year 1:
As of August 31, the bank statement shows a balance of $11,815. The August 31 unadjusted balance in the Cash account of Halls Cards is $8,919. A review of the bank statement revealed the following information:
A deposit of $2,000 on August 31, Year 1, does not appear on the August bank statement.
It was discovered that a check to pay for baseball cards was correctly written and paid by the bank for $3,040 but was recorded on the books as $3,940.
When checks written during the month were compared with those paid by the bank, three checks amounting to $4,055 were found to be outstanding.
A debit memo for $59 was included in the bank statement for the purchase of a new supply of checks.
Required:
Prepare a bank reconciliation at the end of August showing the true cash balance.
Note: Negative amounts should be indicated with minus sign.
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