In: Accounting
On July 31, 2022, Pharoah Company had a cash balance per books of $6,320.00. The statement from Dakota State Bank on that date showed a balance of $7.870.80. A comparison of the bank statement with the Cash account revealed the following facts.
1. The bank service charge for July was $21.00.
2. The bank collected $1,700.00 from a customer for Pharoah Company through electronic funds transfer.
3. The July 31 receipts of $1,377.30 were not included in the bank deposits for July. These receipts were deposited by the company in a night deposit vault on July 31.
4. Company check No. 2480 issued to L. Taylor, a creditor, for $374.00 that cleared the bank in July was incorrectly entered in the cash payments journal on July 10 for $347.00.
5. Checks outstanding on July 31 totaled $2,031.10.
6. On July 31, the bank statement showed an NSF charge of $755.00 for a check received by the company from W. Krueger, a customer, on account.
Prepare the bank reconciliation as of July 31. (List items that increase balance as per bank & books first.)
Journal entry
Date | General Journal | Debit | Credit |
July 31 | Cash | 1700 | |
Account receivable | 1700 | ||
(To record electronic fund transfer received) | |||
July 31 | Account receivable | 755 | |
Cash | 755 | ||
(To record NSF Check) | |||
July 31 | Account payable | 27 | |
Cash | 27 | ||
(To correct error in recording check) | |||
July 31 | Bank Service charge | 21 | |
Cash | 21 | ||
(To record bank service charge) | |||