EX 8-21 Bank reconciliation
An accounting clerk for Muskegon Co. prepared the following bank reconciliation:
Muskegon Co. Bank Reconciliation May 31, 2012 Cash balance according to company’s records . . . . . . . . . . . . . . . . . . . . . . . $ 5,110 Add: Outstanding checks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,500 Error by Muskegon Co. in recording Check No. 2219 as $810 instead of $180. . . . . . . . . . . . . . . . . . . . . . . . . . . . 630 Note for $8,000 collected by bank, including interest. . . . . . . . . . . . 8,320 11,450 $16,560 Deduct: Deposit in transit on May 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $5,200 Bank service charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 5,260 Cash balance according to bank statement. . . . . . . . . . . . . . . . . . . . . . . . . . $11,300
a. From the data in the above bank reconciliation, prepare a new bank reconciliation for Muskegon Co., using the format shown in the illustrative problem.
b. If a balance sheet were prepared for Muskegon Co. on May 31, 2012, what amount should be reported for cash?
Answer:
a. MUSKEGON CO. Bank Reconciliation May 31, 2012 Cash balance according to bank statement................... $11,300 Add: Deposit in transit on May 31................................... 5,200 $16,500 Deduct: Outstanding checks........................................... 2,500 Adjusted balance.............................................................. $14,000 Cash balance according to company’s records............ $ 5,110 Add: Error in recording Check No. 2219 as $810 instead of $180..................................................... $ 630 Note for $8,000 collected by bank, including interest.................................................................. 8,320 8,950 $14,060 Deduct: Bank service charges ........................................ 60 Adjusted balance.............................................................. $14,000
b. $14,000
Muskegon Co. Bank Reconciliation May 31, 2012 Cash balance according to company’s records . . . . . . . . . . . . . . . . . . . . . . . $ 5,110 Add: Outstanding checks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,500 Error by Muskegon Co. in recording Check No. 2219 as $810 instead of $180. . . . . . . . . . . . . . . . . . . . . . . . . . . . 630 Note for $8,000 collected by bank, including interest. . . . . . . . . . . . 8,320 11,450 $16,560 Deduct: Deposit in transit on May 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $5,200 Bank service charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 5,260 Cash balance according to bank statement. . . . . . . . . . . . . . . . . . . . . . . . . . $11,300
a. From the data in the above bank reconciliation, prepare a new bank reconciliation for Muskegon Co., using the format shown in the illustrative problem.
b. If a balance sheet were prepared for Muskegon Co. on May 31, 2012, what amount should be reported for cash?
Answer:
a. MUSKEGON CO. Bank Reconciliation May 31, 2012 Cash balance according to bank statement................... $11,300 Add: Deposit in transit on May 31................................... 5,200 $16,500 Deduct: Outstanding checks........................................... 2,500 Adjusted balance.............................................................. $14,000 Cash balance according to company’s records............ $ 5,110 Add: Error in recording Check No. 2219 as $810 instead of $180..................................................... $ 630 Note for $8,000 collected by bank, including interest.................................................................. 8,320 8,950 $14,060 Deduct: Bank service charges ........................................ 60 Adjusted balance.............................................................. $14,000
b. $14,000
