a) The cash transactions and cash balances of XYZ, Inc., for December were as follows: 1. The ledger account for Cash showed a balance at December 31 of $114,800. 2. The December bank statement showed a closing balance of $104,078. 3. The cash received on December 31 amounted to $15,950. It was left at the bank in the night depository chute after banking hours on December 31 and therefore was not recorded by the bank on the December st
a) The cash transactions and cash balances of XYZ, Inc., for December were as follows:
1. The ledger account for Cash showed a balance at December 31 of $114,800.
2. The December bank statement showed a closing balance of $104,078.
3. The cash received on December 31 amounted to $15,950. It was left at the bank in the night
depository chute after banking hours on December 31 and therefore was not recorded by the
bank on the December statement.
4. Also included with the December bank statement was a debit memorandum from the bank for
$50 representing service charges for December.
5. A credit memorandum enclosed with the December bank statement indicated that a non-
interest bearing note receivable for $4,028 from Johnson, left with the bank for collection, had
been collected and the proceeds credited to the account of XYZ, Inc.
6. Comparison of the paid checks returned by the bank with the entries in the accounting records
revealed that check no. 821 for $520, issued December 15 in payment for office equipment, had
been erroneously entered in XYZ’s records as $916.
7. Examination of the paid checks also revealed that three checks, all issued in December, had
not yet been paid by the bank: no. 811 for $250; no. 814 for $639; no. 823 for $165.
8. Included with the December bank statement was a $200 check drawn by Antonio Gutres, a
customer of XYZ, Inc. This check was marked “NSF.” It had been included in the deposit of
December 27 but had been charged back against the company’s account on December 31.
Instructions
a. Prepare a bank reconciliation for XYZ, Inc., at December 31.
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