Items on a Bank Reconciliation Assume that a company is preparing a bank reconciliation for the...

Items on a Bank Reconciliation

Assume that a company is preparing a bank reconciliation for the month of June. It reconciles the bank balance and the book balance to the correct balance.

For each of the following items, indicate whether the item is an addition to the bank balance, an addition to the book balance, a deduction from the bank balance, a deduction from the book balance, or would not appear on the June reconciliation. Also, choose Yes or No for each answer to indicate whether or not the item will require an adjustment on the company's books.

Item	Impact	Adjustment required?
1. Check written in June but not yet returned to the bank for payment
2. Customer's NSF check
3. Customer's check written in the amount of $54 but recorded on the books in the amount of $45*
4. Service charge for new checks
5. Principal and interest on a customer's note collected for the company by the bank
6. Customer's check deposited on June 30 but not reflected on the bank statement
7. Check written on the company's account, paid by the bank, and returned with the bank statement
8. Check written on the company's account for $123 but recorded on the books as $132*
9. Interest on the checking account for the month of June

*Answer in terms of the adjustment needed to correct for the error.

Expert Solution

Item	Impact	Adjustment required?
1. Check written in June but not yet returned to the bank for payment	A deduction from the bank balance	No
2. Customer's NSF check	A deduction from the book balance	Yes
3. Customer's check written in the amount of $54 but recorded on the books in the amount of $45*	A deduction from the book balance	Yes
4. Service charge for new checks	A deduction from the book balance	Yes
5. Principal and interest on a customer's note collected for the company by the bank	An addition to the book balance	Yes
6. Customer's check deposited on June 30 but not reflected on the bank statement	An addition to the bank balance	No
7. Check written on the company's account, paid by the bank, and returned with the bank statement	Would not appear (NA)	No
8. Check written on the company's account for $123 but recorded on the books as $132*	An addition to the book balance	Yes
9. Interest on the checking account for the month of June	An addition to the book balance	Yes

ekkarill92 answered 2 years ago

Preparing a bank reconciliation

Question Preparing a bank reconciliationThe Cash account of Guard Dog Security Systems reported a balance of $2,540 at December 31, 2018. There were outstanding checks totaling $400 and a December 31 deposit in transit of $100. The bank statement, which came from Park Cities Bank, listed the December 31 balance of $3,340. Included in the bank balance was a collection of $510 on account from Brendan Ballou, a Guard Dog customer who pays the bank directly. The bank statement also...

Classifying bank reconciliation items The following items could appear on a bank reconciliation:

Question Classifying bank reconciliation items The following items could appear on a bank reconciliation:a. Outstanding checks, $670.b. Deposits in transit, $1,500.c. NSF check from customer, no. 548, for $175.d. Bank collection of note receivable of $800, and interest of $80.e. Interest earned on bank balance, $20.f. Service charge, $10.g. The business credited Cash for $200. The correct amount was $2,000.h. The bank incorrectly decreased the business’s account by $350 for a check written by another business.Classify each item as (1)...

Bank Reconciliation The following information is available to assist you in preparing a bank reconciliation for...

Bank Reconciliation The following information is available to assist you in preparing a bank reconciliation for Calico Corners on May 31: The balance on the May 31 bank statement is $8,432.11. Not included on the bank statement is a $1,250 deposit made by Calico Corners late on May 31. A comparison between the canceled checks returned with the bank statement and the company records indicated that the following checks are outstanding at May 31: No. 123 $23.40 No. 127 145.00...

what is a bank reconciliation? what are the steps in preparing a bank reconciliation? what purpose...

what is a bank reconciliation? what are the steps in preparing a bank reconciliation? what purpose does it serve?

Preparing a bank Reconciliation Statement: •The July 31 bank statement for Parkview Company indicated a cash...

Preparing a bank Reconciliation Statement: •The July 31 bank statement for Parkview Company indicated a cash balance of $5,000.17. •The cash ledger account on that date shows a balance of $4,262.83. •Four outstanding checks totaled $717.75. •A $410.90 deposit made after banking hours on July 31 does not appear in the bank statement. •On July 30, the bank returned J.B. Ball’s NSF check for $50.25, received as payment of an account receivable. •The bank statement showed $24.74 interest earned on...

Prepare a bank reconciliation at November 30 List items that increase balance as per bank &...

Prepare a bank reconciliation at November 30 List items that increase balance as per bank & books first The bank portion of last month’s bank reconciliation for Crane Limited at October 31 is shown here: CRANE LIMITED Bank Reconciliation October 31 Cash balance per bank $24,920 Add: Deposits in transit 2,972 27,892 Less: Outstanding cheques #2472 $1,430 #2473 1,600 #2474 1,038 4,068 Reconciled cash balance $23,824 The reconciled cash balance per bank agreed with the reconciled cash balance per books...

Gunnar Company gathered the following reconciling information in preparing its September bank reconciliation. Calculate the adjusted...

Gunnar Company gathered the following reconciling information in preparing its September bank reconciliation. Calculate the adjusted cash balance per books on September 30. Cash balance per books, September 30 $ 3,181 Deposits in transit 421 Notes receivable and interest collected by bank 888 Bank charge for check printing 29 Outstanding checks 1,347 NSF check 144 a.$2,970 b.$3,896 c.$2,255 d.$3,114 Bank Reconciliation The following data were accumulated for use in reconciling the bank account of Mathers Co. for July: Cash balance...

Briefly explain the importance of preparing Bank Reconciliation Statement and analyze the adjustments and the treatment...

Briefly explain the importance of preparing Bank Reconciliation Statement and analyze the adjustments and the treatment of the adjustments that needs to be considered under bank statement and cash book statement. You can access online resources to get the required information while maintaining APA referencing guidance [ 5 marks] [ minimum 500 words].

Bank Reconciliation The bank reconciliation made by Sandler Company, a sole proprietorship, on March 31 showed:...

Bank Reconciliation The bank reconciliation made by Sandler Company, a sole proprietorship, on March 31 showed: Deposit in transit of $1,100 Outstanding checks no.797 $450 no.804 $890 The reconciled cash balance on March 31 was $11,720 The following bank statement is available for April 2012. Bank Statement TO Sandler Company April 30 Fairbanks, AK FAIRBANKS NATIONAL BANK Date Deposits No. Date Charges Date Balance Apr. 1 $1,100 804 Apr. 2 $890 Mar. 31 $11,960 3 1,680 807 3 730 Apr....

James Thomas is responsible for preparing bank reconciliation statements for Ajax Inc. Ajax has many bank...

James Thomas is responsible for preparing bank reconciliation statements for Ajax Inc. Ajax has many bank accounts, including separate accounts for each major branch, accounts for payments of salaries and dividends, and accounts kept in foreign currency for overseas divisions. James maintains records including bank statements and weekly bank reconciliations for each account. In addition, there are files containing correspondence with banks about disputed transactions, dishonored checks from Ajax's customers, and other bank-initiated transactions such as fees and interest. a....

Question