The auditor is suspicious of the abilities of the newly hired accountant of the company he/she is currently auditing. To alleviate his/her concerns, he/she decides to prepare the company bank reconciliation for December 31, 2019 and compare it to the new accountant's results. The adjusted ending "Book" balances on the new accountant's bank reconciliation was $57,335.58. Using the following information, prepare the bank reconciliation for Brown Mfg. Inc. for the month ending December 31, 2019 and determine if there is any difference in the adjusted balance to the accountant's balance. (5 marks)

- The December 31, 2019 bank balance per the bank statement was $47,268.58

- Service charges charged by the bank was $15.85

- There was an NSF cheque on the bank statement from a customer for $1,600.00

- Cheques written by Brown Mfg. Inc. in December but not yet cleared by the bank was $3,973.00

- The company has a direct payment to the insurance company each month of $250.00

- There was an EFT from a customer for $5,530.00

- A cheque not written by Brown Mfg. Inc. was cleared by the bank for a company with a similar name (Brown Supply Ltd.) in the amount of $1,350.00 through this account.

- The bank paid Brown Mfg. Inc. interest of $21.00 on the average balance maintained

throughout the month.

- There was a cheque written and journalized for $500.00 that was cleared by the bank for $5,000.00 (company is correct)

- Deposits made and journalized by Brown Mfg. Inc. but not yet recognized by the bank, $8,190.00

- The December 31, 2019 G/L cash account balance was $53,650.43 before any of the bank reconciliation adjustments.

The difference in your adjusted balance and the new accountant's is?

Question 42 options:

$(4500.00)

$1,350.00

$ 21.00

$ 0