The following information pertains to Grey Company.

1. Cash balance per bank, on March 31, 2019, $152,000.

2. Cash balance per company ledger, on March 31, 2019, $158,530.

3. Deposits in transit, on March 31, $20,000.

4. Outstanding checks, on March 31, $10,000.

5. The bank statement included a debit memo of $40 for printing of additional company checks.

6. On March 18, the company issued a check no. 118 for $1,370 to Ali. The check which was cleared by the bank in March, was incorrectly journalized and posted for $1,316.

7. A $4,000 note receivable was collected by the bank for the company on March 31, plus interest of $214. The bank charged a collection fee of $50.

8. On March 31, the bank statement showed $600 NSF for a check issued by a customer to the company on account.

Required:

a) Prepare a bank reconciliation on March 31 (2.75 marks).

b) Prepare the necessary adjusting entries on March 31 on the books of Grey Company (4.25 Marks).