Question

Prepare a Bank Reconciliation Statement from the information provided and prepare  adjusting Journal Entries.

The information below relates to the Cash account in the ledger of Bramble Company.

Balance September 1—$17,010;		Cash deposited—$64,500.
Balance September 30—$17,664;		Checks written—$63,846.

The September bank statement shows a balance of $16,682 on September 30 and the following memoranda.

Credits		Debits
Collection of $1,621 note plus interest $39		$1,660		NSF check: Richard Nance		$555
Interest earned on checking account		$54		Safety deposit box rent		$74

At September 30, deposits in transit were $4,580, and outstanding checks totaled $2,513

Answer 1

Bramble Company
Bank Reconciliation
September 30
Bank Balance		$16,682
Add: Deposit in Transit		$4,580
		$21,262
Less: Outstanding Checks		-$2,513
Adjusted Bank Balance		$18,749
Book Balance		$17,664
Add: Collection of Notes Receivable	$1,660
Interest Earned	$54
		$1,714
		$19,378
Less: NSF Check	-$555
Safety Deposit Box Rent	-$74
		-$629
Adjusted Book Balance		$18,749

 

Journal
Date	Particulars	Debit ($)	Credit ($)
Sept 30	Cash A/c Dr	$1,660
	To Notes receivable A/c		$1,621
	To Interest Receivable		$39
	(to record notes receivable)
Sept 30	Cash A/c Dr	$54
	To Interest Revenue		$54
	(to record interest earned)
Sept 30	Accounts Receivable - Richard Nance	$555
	To Cash		$555
	(to record NSF Check)
Sept 30	Safety Deposit Rent Expense A/c Dr	$74
	To Cash		$74
	(to record safety deposit rent)

 

 

4 required journal entries have been passed and the required reconciliation was done to balance the Passbook and Cashbook balances.