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    E7 25

    Uploaded by

    Muhammad Syafiq Ramadhan
    The bank reconciliation summary shows deposits in transit of $3,800, outstanding checks of $1,550, and cash on hand of $310. The bookkeeper incorrectly recorded a check for $146.50 that was actually for $164.50. The bank reconciliation is prepared showing a correct cash balance of $10,649. Entries are made to record the collection of a note and interest, pay bank charges, and correct the error in the supplies check amount. The $10,649 cash balance should be reported in the August 31 balance sheet.

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    E7 25

    Uploaded by

    Muhammad Syafiq Ramadhan
    1K views2 pages
    The bank reconciliation summary shows deposits in transit of $3,800, outstanding checks of $1,550, and cash on hand of $310. The bookkeeper incorrectly recorded a check for $146.50 that was actually for $164.50. The bank reconciliation is prepared showing a correct cash balance of $10,649. Entries are made to record the collection of a note and interest, pay bank charges, and correct the error in the supplies check amount. The $10,649 cash balance should be reported in the August 31 balance sheet.

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    E7.25

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    The bank reconciliation summary shows deposits in transit of $3,800, outstanding checks of $1,550, and cash on hand of $310. The bookkeeper incorrectly recorded a check for $146.50 that was actually for $164.50. The bank reconciliation is prepared showing a correct cash balance of $10,649. Entries are made to record the collection of a note and interest, pay bank charges, and correct the error in the supplies check amount. The $10,649 cash balance should be reported in the August 31 balance sheet.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    1K views2 pages

    E7 25

    Uploaded by

    Muhammad Syafiq Ramadhan
    The bank reconciliation summary shows deposits in transit of $3,800, outstanding checks of $1,550, and cash on hand of $310. The bookkeeper incorrectly recorded a check for $146.50 that was actually for $164.50. The bank reconciliation is prepared showing a correct cash balance of $10,649. Entries are made to record the collection of a note and interest, pay bank charges, and correct the error in the supplies check amount. The $10,649 cash balance should be reported in the August 31 balance sheet.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    Q:

    Aragon Company has just received the August 31, 2012, bank statement, which is summarized
    below.

    Deposits in transit at August 31 are $3,800, and checks outstanding at August 31 total $1,550.
    Cash on hand at August 31 is $310. The bookkeeper improperly entered one check in the books
    at $146.50 which was written for $164.50 for supplies (expense); it cleared the bank during the
    month of August.
    Instructions
    (a) Prepare a bank reconciliation dated August 31, 2012, proceeding to a correct balance.
    (b) Prepare any entries necessary to make the books correct and complete.
    (c) What amount of cash should be reported in the August 31 balance sheet?

    A:

    (a) ARAGON COMPANY


    Bank Reconciliation, August 31, 2012
    County National Bank
    Balance per bank statement, August 31, 2012............................... $ 8,089
    Add: Cash on hand........................................................................ $ 310
    Deposits in transit............................................................... 3,800 4,110
    12,199
    Deduct: Outstanding checks.......................................................... 1,550
    Correct cash balance....................................................................... $10,649

    Balance per books, August 31, 2012


    ($10,050 + $35,000 – $35,403)................................................... $ 9,647
    Add: Note ($1,000) and interest ($40) collected........................... 1,040
    10,687
    Deduct: Bank service charges....................................................... $ 20
    Understated check for supplies..................................... 18 38
    Correct cash balance $10,649

    (b) Cash.............................................................................................. 1,040


    Notes Receivable................................................................ 1,000
    Interest Revenue................................................................. 40
    (To record collection of note and
    interest)

    Office Expense (Bank Charges)................................................... 20


    Cash.................................................................................... 20
    (To record August bank charges)

    Supplies Expense.......................................................................... 18
    Cash.................................................................................... 18
    (To record error in recording check
    for supplies)

    (c) The corrected cash balance of $10,649 would be reported in the


    August 31, 2012, balance sheet.

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