Question
The bank reconciliation prepared on March 31, 2020, appeared as follows: Bank Reconciliation March 31, 2020 Bank statement balance $ 15,400 Book balance $ 34,036
The bank reconciliation prepared on March 31, 2020, appeared as follows:
Bank Reconciliation | ||||||||||
March 31, 2020 | ||||||||||
Bank statement balance | $ | 15,400 | Book balance | $ | 34,036 | |||||
Add: | ||||||||||
Deposit of March 31 in transit | 21,902 | |||||||||
37,302 | ||||||||||
Deduct: | ||||||||||
Outstanding cheques: | ||||||||||
#79 | $ | 1,298 | ||||||||
#84 | 1,968 | 3,266 | ||||||||
Adjusted bank balance | $ | 34,036 | Adjusted book balance | $ | 34,036 | |||||
The Cash account in the General Ledger appeared as follows on April 30:
Cash | Acct. No. 101 | ||||||||
Date | Explanation | PR | Debit | Credit | Balance | ||||
2020 | |||||||||
March | 31 | Balance | 34,036.00 | ||||||
April | 30 | CR11 | 35,417.00 | 69,453.00 | |||||
30 | CD14 | 45,263.00 | 24,190.00 | ||||||
A list of deposits made and cheques written during April, taken from the Cash Receipts Journal and Cash Disbursements Journal, is shown below:
Deposits Made | |||||
April | 7 | $ | 14,770.00 | ||
13 | 886.00 | ||||
18 | 14,176.00 | ||||
23 | 987.00 | ||||
27 | 1,968.00 | ||||
30 | 2,630.00 | ||||
Total April Cash Receipts | $ | 35,417.00 | |||
Cheques Written | |||||
No. | 91 | $ | 1,248 | ||
92 | 5,440 | ||||
93 | 2,590 | ||||
94 | 3,590 | ||||
95 | 3,014 | ||||
96 | 1,883 | ||||
97 | 8,806 | ||||
98 | 3,014 | ||||
99 | 8,926 | ||||
100 | 6,752 | ||||
Total April Cash Disbursements | $ | 45,263 | |||
The following bank statement is available for April: (Note: The bank deposits interest into the bank account at the end of every month.)
Bank Statement | ||||||||||
To: | April 30, 2020 | |||||||||
Cheques/Charges | Deposits/Credits | Balance | ||||||||
15,400 | ||||||||||
#93 | 04/02 | 2,509 | 04/03 | 21,902 | 34,793 | |||||
#92 | 04/07 | 5,440 | 04/07 | 14,770 | 44,123 | |||||
#84 | 04/13 | 1,968 | 04/13 | 886 | 43,041 | |||||
NSF | 04/18 | 6,828 | 04/18 | 14,176 | 50,389 | |||||
#95 | 04/23 | 3,014 | 04/23 | 987 | 48,362 | |||||
#99 | 04/27 | 8,926 | 04/27 | 1,968 | 41,404 | |||||
#96 | 04/30 | 1,883 | 04/30 | 2,630 | 42,151 | |||||
#97 | 04/30 | 8,806 | INT | 46 | 33,391 | |||||
#94 | 04/30 | 3,590 | 29,801 | |||||||
PMT | 04/30 | 9,798 | 20,003 | |||||||
INT | 04/30 | 35 | 19,968 | |||||||
SC | 04/30 | 55 | 19,913 | |||||||
NSF = Not Sufficient Funds | SC = Service Charge | PMT = Principal Payment | INT = Interest | |||||||
In reviewing cheques returned by the bank, the bookkeeper discovered that cheque #93, for delivery expense, was recorded in the Cash Disbursements Journal incorrectly as $2,590. The NSF cheque was that of customer Laura Clark, deposited in April. Required: a. Prepare a bank reconciliation at April 30.
b. Prepare the necessary journal entries to bring the General Ledger Cash account into agreement with the adjusted balance on the bank reconciliation.
b. Prepare the necessary Journal entries to bring the General Ledger Cash account into agreement with the adjusted balance on the bank reconciliation. View transaction list Journal entry worksheet Record interest earned. Note: Enter debits before credits. General Journal Credit Date Apr 30 Debit 46 Cash Interest revenue 46 Record entry Clear entry View general journal b. Prepare the necessary Journal entries to bring the General Ledger Cash account into agreement with the adjusted balance on the bank reconciliation View transaction list Journal entry worksheet Record to account for error in Cheque #93. Note: Enter debits before credits. Debit Credit Date Apr 30 General Journal Bank service charges expense Cash 81 81 Record entry Clear entry View general journal b. Prepare the necessary Journal entries to bring the General Ledger Cash account into agreement with the adjusted balance on the bank reconciliation. View transaction list Journal entry worksheet Record April loan payment. Note: Enter debits before credits. General Journal Debit Credit Date Apr 30 Cash 9,798 Loan payable or Notes payable 9,798 Record entry Clear entry View general journal b. Prepare the necessary Journal entries to bring the General Ledger Cash account into agreement with the adjusted balance on the bank reconciliation. View transaction list Journal entry worksheet Record April interest expense. Note: Enter debits before credits. Date Debit Credit Apr 30 General Journal Cash Interest expense 35 35 Record entry Clear entry View general journalStep by Step Solution
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