Question

below is information from XYZ Inc. as of june 30, 2017.

1.) Cash on the books as of June 30 is $42,754.16. cash on the bank statement for the same day is $52,351.46.

2) A deposit of $5220.94 did not appear on the bank statement.

3.) outstanding checks totaled $3936.80.

4.) A check for $1920 returned with the statement was recorded incorrectly in the check register as $1380. The check was for cash purchase of merchandise inventory.

5.) The bank service charge for June amounted to $25.

6.) The bank collected $12,360 for XYZ Inc. on a note. The fact value of the note was $12,000.

7.) as NSF check for $183.56 from a customer was returned with the statement.

8.) The bank mistakenly charged to the company account a check for $850 drawn by another company.

9.) The bank reported that it had credited the account for $120 in interest on the average balance for may.

A.) prepare a bank reconciliation for XYZ Inc. of June 30, 2017

B.) prepare the journal entries necessary to adjust the accounts.

Answer 1

Bank reconciliation statement
Description	Amount
Balance as per Bank	$ 52,351.46
Bank fee and charges	$         25.00
Interest credited by bank	$     (120.00)
Chequed cleared by error by bank	$       850.00
Note collected by bank with interest	$(12,360.00)
Deposit not yet reflected in bank	$    5,220.94
NSF cheque	$       183.56
Cheque returned	$       540.00
Cheque not yet presented	$ (3,936.80)
total of above	$ 42,754.16
Balance as per Cash account	$ 42,754.16
Variance	$              -
Bank charges                  Dr	$         25.00
To Bank		$       25.00
(Being bank charges accounted)
Bank                                                     Dr	$       120.00
To Interest revenue		$     120.00
(Being interest revenue recognized)
Bank                                                     Dr	$ 12,360.00
To Interest revenue		$     360.00
To Note receivable		$12,000.00
(Being interest revenue recognized)
Accounts receivable                   Dr	$       183.56
To Bank		$     183.56
(Being NSF cheque returned)
Bank                                                     Dr	$       540.00
To Accounts payable		$     540.00
(Being cheque returned with incorrect amount)