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You have just received the 31 December 2020 bank statement of Modern Solar from Southpac Bank. To assist you in your bank reconciliation, you have
You have just received the 31 December 2020 bank statement of Modern Solar from Southpac Bank. To assist you in your bank reconciliation, you have gathered the following information: 1. The ledger's cash account shows a balance of $11,600 on 31 December. 2. The bank statement includes two dishonoured cheques from customers, of $1,600 and $440. 3. The following Modern Solar cheques are outstanding (unpresented) at 31 December: Cheque Number Amount (S) 220 242 243 262 281 282 200 680 2,080 2.320 200 560 4. Modern Solar collects money from some customers through Electronic Funds Transfer (EFT). The December bank statement lists a $5,200 EFT deposit for a collection on an accounts receivable, on 31 December 5. The bank statement includes two deposits that Modern Solar has not recorded yet: $3,880 for dividend revenue and $320 interest revenue earned on a term deposit 6. The bank statement included a $120 bank service charge. 7. On 31 December, Modern Solar deposited $1,400 but this deposit is not reflected on the bank statement. 8. The bank statement included a $4.000 deduction for a cheque drawn by an unrelated company, Widget Limited. Modern Solar has now notified the bank of this error. 9. The 31 December 2020 bank balance, per the bank statement, is $19,480. Required: Prepare the bank reconciliation for Modern Solar as at 31 December 2020. See exhibit 6.4 on page 244of the text for the format. (10 marks)
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