In: Accounting
On August 31, 2019, the balance in the checkbook and the Cash account of the Dry Creek Bed and Breakfast was $12,300. The balance shown on the bank statement on the same date was $13,207.
Notes
The firm’s records indicate that a $1,470 deposit dated August 30 and a $703 deposit dated August 31 do not appear on the bank statement.
A service charge of $9 and a debit memorandum of $330 covering an NSF check have not yet been entered in the firm’s records. (The check was issued by Art Corts, a credit customer.)
The following checks were issued but have not yet been paid by
the bank:
Check 712, |
$ |
112 |
|
Check 713, |
$ |
127 |
|
Check 716, |
$ |
240 |
|
Check 736, |
$ |
579 |
|
Check 739, |
$ |
80 |
|
Check 741, |
$ |
122 |
|
A credit memorandum shows that the bank collected a $2,094 note
receivable and interest of $65 for the firm. These amounts have not
yet been entered in the firm’s records.
Required:
Prepare a bank reconciliation statement for the firm as of August 31.
Record general journal entries for items on the bank reconciliation statement that must be journalized.
Analyze:
What effect did the journal entries recorded as a result of the
bank reconciliation have on the fundamental accounting
equation?