The cash account for Bravo Bike Co. at May 1, 2014, indicated a balance of $12,890. During May, the total cash deposited was $63,940 and checks written totaled $59,370. The bank statement indicated a balance of $21,680 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items:

Checks outstanding totaled $9,650.

A deposit of $7,860, representing receipts of May 31, had been made too late to appear on the bank statement.

The bank had collected for Bravo Bike Co. $4,160 on a note left for collection. The face of the note was $3,840.

A check for $270 returned with the statement had been incorrectly charged by the bank as $720.

A check for $850 returned with the statement had been recorded by Bravo Bike Co. as $580. The check was for the payment of an obligation to Portage Co. on account.

Bank service charges for May amounted to $50.

A check for $960 from Elkhart Co. was returned by the bank because of insufficient funds.

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2. Journalize the necessary entries (a.) that increase cash and (b.) that decrease cash. The accounts have not been closed. For a compound transaction, if an amount box does not require an entry, leave it blank.

3. if a balance sheet were prepared for Bravo Bike Co. on May 31, 2014, what amount should be reported as cash?

1. Prepare a bank reconciliation as of May 31. Bravo Bike Co. Bank Reconciliation May 31, 2014 Balance per bank statement Adjusted balance Cash balance according to company's records Adjusted balance