Question

The following information pertains to the bank transactions of Crawford Company:

A. Cash on the books as of September 30 was $1,299. Cash, as shown on the bank statement for the same date, was $1,330.

B Bank service charges for September amounted to $9.

C. A deposit of $160, representing cash receipts of September 30, did not appear on the bank statement.

D An NSF check for $80 from a customer, Jack Betz, was returned with the statement.

E. Outstanding checks totaled $240.

F. Interest earned on the account of $40 was reported on the bank statement.

Questions

1. Prepare the bank reconciliation in good form (label all numbers) for Crawford Company as of September 30.

2. Write the amount of cash that should appear on the balance sheet as of September 30.

3. Write the letter(s) of any of the reconciling items that require journal entries in the accounting records.

Answer 1

1

Crawford Company
Bank reconciliation
September 30
Balance per bank, September 30		1330
Add deposit in transit		160
		1490
Deductions:
outstanding checks		240
Adjusted bank balance, September 30		1250
Balance per books, September 30		1299
Add:
Interest on note receivable	40	40
		1339
Deductions:
Bank service charge	9
NSF check	80	-89
Adjusted book balance		1250

2

Cash that should appear on the balance sheet as of September 30 =$1,250

3

Following item require the journal entry

· Bank service charge of $9

· NSF Check from account receivable of Jack Betz of $80

· Interest income of $40

Date	General Journal	Debit $	Credit $
September,30	Bank service charge	9
	Cash		9
September,30	Cash	40
	Interest income		40
September,30	Accounts receivable, Jack Betz	80
	Cash		80