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Bank Reconciliation The cash account of Abstract, Inc., disclosed a balance of $16,348.82 on October 31....

Bank Reconciliation

The cash account of Abstract, Inc., disclosed a balance of $16,348.82 on October 31. The bank statement as of October 31 showed a balance of $19,711.75. Upon comparing the statement with the cash records, the following facts were developed.(a) Abstract’s account was charged on October 26 for a customer’s uncollectible check amounting to $1,927.(b) A 2-month, 8%, $1,350 customer’s note dated August 25, discounted on October 12, was dishonored October 26 and the bank charged Abstract $1,374.91, which included a protest fee of $6.91.(c) A customer’s check for $580 was entered as $530 by both the depositor and the bank but was later corrected by the bank.(d) Check No. 661 for $1,838.00 was entered in the cash disbursements journal at $1,383.00 and Check No. 652 for $47.50 was entered as $475.00. The company uses the voucher system.(e) Bank service charges of $54.81 for October were not yet recorded on the books.(f) A bank memo stated that C. Castro’s note for $1,800 and interest of $74.20 had been collected on October 29, and the bank charged $15.00. (No entry was made on the books when the note was sent to the bank for collection.)(g) Receipts of October 29 for $5,450 were deposited November 1.The following checks were outstanding on October 31:

No. 620. . . . . . . . . . . . . . . . . . . . . $1,075.00

No. 671. . . . . . . . . . . . . . . . . . . . . $ 567.55

No. 621. . . . . . . . . . . . . . . . . . . . . 2,199.98

No. 673. . . . . . . . . . . . . . . . . . . . . 337.99

No. 632. . . . . . . . . . . . . . . . . . . . . 2,765.25

No. 675. . . . . . . . . . . . . . . . . . . . . 375.80

No. 670. . . . . . . . . . . . . . . . . . . . . 1,776.89

No. 676. . . . . . . . . . . . . . . . . . . . . 1,189.49

Instructions: 1. Prepare a bank reconciliation as of October 31. 2. Give the journal entries required as a result of the preceding information.

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ekkarill92 answered 2 years ago
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