Question

1. Roper Electronics received its bank statement for the month of August with an ending balance of $11,740. Roper determined that Check No. 613 for $155 and Check No. 601 for $420 were both outstanding. Also, a $6,900 deposit for August 30 was in transit as of the end of the month. Northern Regional Bank also collected a $5,000 notes receivable on August 1 that was issued March 1. Accrued interest is $250. Northern Regional Bank charged a $35 fee for the collection service. The bank statement reveals a bank service charge of $20. A customer check for $68 was returned with the bank statement marked "NSF." The ending balance of the Roper cash account is $12,938.

   Prepare a bank/account reconciliation and any necessary journal entries for the reconciliation.

   Roper Electronics
   Bank Reconciliation
   August 31
   Cash balance according to bank statement		$
   Add deposit in transit
   Add note receivable
   Adjusted balance		$
   Cash balance according to Roper Electronics		$
   Adjusted balance		$

   Record the entry to increase cash first. For a compound transaction, If an amount box does not require an entry, leave it blank.

   Aug. 31	Cash
   	Bank Service Charge Expense
   	Interest Revenue
   Aug. 31
   Aug. 31
   Aug. 31

Answer 1

Solution:

ROPER ELECTRONICS Bank Reconciliation Statement for the month of August
Cash balance according to bank statement	11,740
Add:
deposit in transit (added to Cashbook but not in bank book, now added)	6,900
collection service fee (deducted from bank book but not in cash book, added back)	35
service charge (deducted from bank book but not in cash book, added back)	20
NSF check: (added to cash book but not in bank book, now added)	68
	18,763
Less:
outstanding checks 155 + 420 (deducted in cash book but not in bank book, now deducted)	575
notes receivable (added to bank book without the knowledge to company so not added to cash book. deducted back)	5,000
accrued interest (added to bank book without the knowledge to company so not added to cash book. deducted back)	250
Balance as per cash book	12,938

Note:

1) NSF check is a check that a bank doesn't deposit due to insufficient funds. Company adds the amount to cash book but doesn't clear the check. So it doesn't add to bank book.

2) sentences in brackets are just clarifications for knowledge, not necessary to write in solutions.

Transactions that have been omitted to be entered in Cash Book will be 1st journalised:

1) Collection charge Dr. 35     Bank cr. 35

2) Service charge Dr. 20 Bank cr. 20

3) Accounts receivable dr 68 Bank cr. 68

4) Bank Dr.   5000        Notes Receivable cr. 5000

5) Bank Dr. 250    Accrued Interest cr. 250

feel free to ask any doubt