Bank Recon

Bank Reconciliation and Entries

The cash account for Online Medical Co. at June 30, 2014, indicated a balance of $15,065.

The bank statement indicated a balance of $17,490 on June 30, 2014.

Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:

a. Checks outstanding totaled $6,300.

b. A deposit of $6,560, representing receipts of June 30, had been made too late to appear on the bank statement.

c. The bank had collected $3,410 on a note left for collection. The face of the note was $3,240.

d. A check for $550 returned with the statement had been incorrectly recorded by Online Medical Co. as $500. The check was for the payment of an obligation to Hirsch Co. for the purchase on account.

e. A check drawn for $70 had been erroneously charged by the bank as $700.

f. Bank service charges for June amounted to $45.

2. Journalize the necessary entries (a.) that increase cash and (b.) that decrease cash.

The accounts have not been closed. For a compound transaction, if an amount box does not require an entry, leave it blank.

3. If a balance sheet were prepared for Online Medical Co. on June 30, 2014, what amount should be reported as cash?

9 years ago

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