The following information pertains to Lance Company.

1. Cash balance per bank, July 31, $7,328.

2. July bank service charge not recorded by the depositor $38.

3. Cash balance per books, July 31, $7,364.

4. Deposits in transit, July 31, $2,700.

5. $2,016 collected for Lance Company in July by the bank through electronic funds transfer. The collection has not been recorded by Lance Company.

6. Outstanding checks, July 31, $686. Instructions

(a) Prepare a bank reconciliation at July 31, 2017.

(b) Journalize the adjusting entries at July 31 on the books of Lance Company.