The following information is available for preparation of bank reconciliation statement of Best Buy Company as of August 31.

a. On August 31, the companys statement showed $41,517, but companys Cash Book showed a $40,667 debit balance.

b. On August 31, Best Buy deposited $7,950 in the banks night depository, but does not appear on the bank statement.

c. Check No. 903 for $1,780 and Check No. 913 for $810 are outstanding checks as of August 31.

d. In comparing the bank statement with the entries in the accounting records, it is found that Check No. 927 of $230 for August insurance expense was correctly written and paid at bank account but was erroneously entered in the accounting records as $320.

e. August bank statement showed $6,670 cash collected on a note for Best Buy Company. The company had not recorded this transaction before receiving the statement.

f. A customers NSF check in the amount of $520 was returned with the August bank statement.

g. The August statement shows a $30 bank service fee. It has not yet been recorded in the companys book.

Required

(i) Prepare the bank reconciliation for this company as of August 31. (10 marks)

(ii) Prepare the journal entries necessary to bring the companys book balance of cash into conformity with the reconciled cash balance as of August 31. (4 marks)

(iii) What is the purpose of preparing for a bank reconciliation? (3 marks)

List three strategies which may help for effective cash management. (3 marks)