The cash account for Pala Medical Co at June 30, 20Y1, indicated a balance of $91,408 The bank statement indicated a balance of $126,590 on June 30, 20Y1 Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items a Checks outstanding totaled $33,700 b A deposit of $18,900, representing receipts of June 30, had been made too late to appear on the bank statement c The bank collected $22,042 on a $20,600 note, including interest of $1,442 d A check for $1,600 returned with the statement had been incorrectly recorded by Pala Medical Co as $160 The check was for the payment of an obligation to Skyline Supply Co for a purchase on account e A check drawn for $680 had been erroneously charged by the bank as $860 f Bank service charges for June amounted to $40 Instructions 1 Prepare a bank reconciliation Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries Add Deduct will automatically appear if it is required For those boxes in which you must enter subtracted or negative numbers use a minus sign 2 Journalize the necessary entries Refer to the Chart of Accounts for exact wording of account titles 3 If a balance sheet were prepared for Pala Medical Co on June 30, 20Y1, what amount should be reported as cash CHART OF ACCOUNTS Pala Medical Co General Ledger ASSETS 110 Cash 111 Petty Cash 120 Accounts Receivable 131 Notes Receivable 141 Merchandise Inventory 145 Office Supplies 146 Store Supplies 151 Prepaid Insurance 181 Land 191 Office Equipment 192 Accumulated Depreciation Office Equipment 193 Store Equipment 194 Accumulated Depreciation Store Equipment LIABILITIES 211 Accounts Payable Skyline Supply Co 221 Notes Payable 222 Interest Payable 231 Salaries Payable 241 Sales Tax Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends REVENUE 410 Sales 610 Interest Revenue EXPENSES 510 Cost of Merchandise Sold 515 Credit Card Expense 516 Cash Short and Over 520 Salaries Expense 531 Advertising Expense 532 Delivery Expense 533 Insurance Expense 534 Office Supplies Expense 535 Rent Expense 536 Repairs Expense 537 Selling Expenses 538 Store Supplies Expense 561 Depreciation Expense Office Equipment 562 Depreciation Expense Store Equipment 590 Miscellaneous Expense 710 Interest Expense Amount Descriptions Adjusted balance Bank error in charging check as $860 instead of $680 Bank service charges Deposit in transit on June 30 Deposit of June 30, not recorded by bank Error in recording check Outstanding checks Note collected by bank, including $1,442 interest Total additions Total deductions

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The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $91,408. The bank statement indicated a balance of $126,590 on

The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $91,408. The bank statement indicated a balance of $126,590 on June 30, 20Y1. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:

a.	Checks outstanding totaled $33,700.
b.	A deposit of $18,900, representing receipts of June 30, had been made too late to appear on the bank statement.
c.	The bank collected $22,042 on a $20,600 note, including interest of $1,442.
d.	A check for $1,600 returned with the statement had been incorrectly recorded by Pala Medical Co. as $160. The check was for the payment of an obligation to Skyline Supply Co. for a purchase on account.
e.	A check drawn for $680 had been erroneously charged by the bank as $860.
f.	Bank service charges for June amounted to $40.

	Instructions
1.	Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. "Add:" & "Deduct:" will automatically appear if it is required. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
2.	Journalize the necessary entries. Refer to the Chart of Accounts for exact wording of account titles.
3.	If a balance sheet were prepared for Pala Medical Co. on June 30, 20Y1, what amount should be reported as cash?

CHART OF ACCOUNTS

Pala Medical Co.

General Ledger

	ASSETS
110	Cash
111	Petty Cash
120	Accounts Receivable
131	Notes Receivable
141	Merchandise Inventory
145	Office Supplies
146	Store Supplies
151	Prepaid Insurance
181	Land
191	Office Equipment
192	Accumulated Depreciation-Office Equipment
193	Store Equipment
194	Accumulated Depreciation-Store Equipment

	LIABILITIES
211	Accounts Payable-Skyline Supply Co.
221	Notes Payable
222	Interest Payable
231	Salaries Payable
241	Sales Tax Payable

	EQUITY
310	Common Stock
311	Retained Earnings
312	Dividends

	REVENUE
410	Sales
610	Interest Revenue

	EXPENSES
510	Cost of Merchandise Sold
515	Credit Card Expense
516	Cash Short and Over
520	Salaries Expense
531	Advertising Expense
532	Delivery Expense
533	Insurance Expense
534	Office Supplies Expense
535	Rent Expense
536	Repairs Expense
537	Selling Expenses
538	Store Supplies Expense
561	Depreciation Expense-Office Equipment
562	Depreciation Expense-Store Equipment
590	Miscellaneous Expense
710	Interest Expense

Amount Descriptions
Adjusted balance
Bank error in charging check as $860 instead of $680
Bank service charges
Deposit in transit on June 30
Deposit of June 30, not recorded by bank
Error in recording check
Outstanding checks
Note collected by bank, including $1,442 interest
Total additions
Total deductions