PE 8-3A Bank reconciliation

The following data were gathered to use in reconciling the bank account of Azalea Company:

Balance per bank                $25,500
Balance per company records 27,475
Bank service charges              75
Deposit in transit                 7,500
NSF check                 3,400
Outstanding checks         9,000

a. What is the adjusted balance on the bank reconciliation?
b. Journalize any necessary entries for Azalea Company based on the bank reconciliation.

Answer:

a. $24,000 as shown below.
Bank section of reconciliation: $25,500 + $7,500 – $9,000 = $24,000  
Company section of reconciliation: $27,475 – $75 – $3,400 = $24,000

b.
Accounts Receivable ................... 3,400
Miscellaneous Expense..................... 75  
                Cash .....................................  3,475

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