Sometimes both companies and banks make errors. To assist in identifying errors, it is important for companies to check their records against the banks records, to ensure that both the companys and the bank records are in agreement.

For this task you will be required to assist the company in identifying if any errors are present by preparing a bank reconciliation statement.

On August 31, 20--, R. Johnson Co. has a balance of $2 240 in its ledger cash account. The bank statement received from their bank shows a balance of $1 574.75.

The bank statement contains a deduction of $10.60 for bank service charges. A comparison of the cheques issued and recorded in the journal of the company and the cheques paid for on the bank statement indicates that Cheque 72 for $48.60, Cheque 86 for $250, and Cheque 89 for $46.75 are outstanding. A deposit made on August 30 for $1 000 was not shown on the bank statement.

Prepare a bank reconciliation statement.