The following information is available for Unique Globe, Inc., as of May 31,2010:

a. Cash on the books as of May 31 amounted to $43,784.16. Cash on the

bank statement for the same date was $53,451.46.

b. A deposit of $5,220.94, representing cash receipts of May 31, did not

appear on the bank statement.

c. Outstanding checks totaled $3,936.80.

d. A check for $1,920.00 returned with the statement was recorded incorrectly

in the check register as $1,380.00. The check was for a cash purchase of

merchandise.

e. The bank service charge for May amounted to $30.

f. The bank collected $12,200.00 for Unique Globe, Inc., on a note. The face

value of the note was $12,000.00.

g. An NSF check for $178.56 from a customer, Eve Lay, was returned with the

statement.

h. The bank mistakenly charged to the company account a check for $750.00

drawn by another company.

i. The bank reported that it had credited the account for $250.00 in interest

on the average balance for May.

Required

1. Prepare a bank reconciliation for Unique Globe, Inc., as of May 31, 2010.

2. Prepare the entries in journal form necessary to adjust the accounts.

3. What amount of cash should appear on Unique Globe, Inc.s balance sheet as

of May 31?

4. Why is a bank reconciliation considered an important control over cash?