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a. Prepare a bank reconciliation for Adam Company at April 30. b. Prepare the necessary journal entries to bring the Cash in Bank account into agreement with the reconciled cash balance on the bank reconciliation.

a. Prepare a bank reconciliation for Adam Company at April 30. b. Prepare the necessary journal entries to bring the Cash in Bank account into agreement with the reconciled cash balance on the bank reconciliation.

Financial Accounting: The Impact on Decision Makers
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter6: Cash And Internal Control
Section: Chapter Questions
Problem 6.3E
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LOS P7-5B. Bank Reconciliation The bank reconciliation made by Adam Company, a sole proprietorship, on March 31 showed a deposit in transit of S1,300 and two outstanding checks, No. 797 for $550 and No. 804 for $690. The reconciled cash balance on March 31 was $12,020. The following bank statement is available for April 30: MRC Bank Statement то Adam Company Fairbanks, AK April 30 FAIRBANKS NATIONAL BANK Date Deposits No. Date Charges Date Balance Mar. $ 690 Apr. 31 ... $11,960 Apr. $1,300 804 Apr. 13,260 12,570 13,520 .. 1,680 1,250 1,020 807 730 808 1,240 838 3. 13 B09 12,692 18 840 810 1,040 541 13 13,171 .... 23 990 811 16 12,131 27 1,340 813 27 640 18 12,471 30 1,160 814 23 600 23 12,861 30 95IN NSF SC 18 30 500 27 13,561 14,776 40 30 Item Codes: EC: Error Correction SC: Service Charge IN: Interest Eamed DM: Debit Memo OD: Overdraft NSF: Non-sufficient Funds CM: Credit Memo RT: Retumed Item A list of deposits made and checks written during April is shown below: O Cambridge Business Publishers Chapter 7 Internal Control and Cash 365 Deposits Made Checks Written Apr. 2.. No. 807 $ 730 $1,680 1,250 808 1,240 10 1,020 809 838 810 811 812 17 840 1,040 22 990 451 948 640 24 1,340 29 1,160 813 30 1,425 814 600 815 816 372 875 $9,705 ....... $7,734 37769
Transcribed Image Text:LOS P7-5B. Bank Reconciliation The bank reconciliation made by Adam Company, a sole proprietorship, on March 31 showed a deposit in transit of S1,300 and two outstanding checks, No. 797 for $550 and No. 804 for $690. The reconciled cash balance on March 31 was $12,020. The following bank statement is available for April 30: MRC Bank Statement то Adam Company Fairbanks, AK April 30 FAIRBANKS NATIONAL BANK Date Deposits No. Date Charges Date Balance Mar. $ 690 Apr. 31 ... $11,960 Apr. $1,300 804 Apr. 13,260 12,570 13,520 .. 1,680 1,250 1,020 807 730 808 1,240 838 3. 13 B09 12,692 18 840 810 1,040 541 13 13,171 .... 23 990 811 16 12,131 27 1,340 813 27 640 18 12,471 30 1,160 814 23 600 23 12,861 30 95IN NSF SC 18 30 500 27 13,561 14,776 40 30 Item Codes: EC: Error Correction SC: Service Charge IN: Interest Eamed DM: Debit Memo OD: Overdraft NSF: Non-sufficient Funds CM: Credit Memo RT: Retumed Item A list of deposits made and checks written during April is shown below: O Cambridge Business Publishers Chapter 7 Internal Control and Cash 365 Deposits Made Checks Written Apr. 2.. No. 807 $ 730 $1,680 1,250 808 1,240 10 1,020 809 838 810 811 812 17 840 1,040 22 990 451 948 640 24 1,340 29 1,160 813 30 1,425 814 600 815 816 372 875 $9,705 ....... $7,734 37769
The Cash in Bank account balance on April 30 was $13,991. In reviewing checks returned by the bank, the accountant discovered that check No. 811, written for $541 for delivery expense, was recorded in the cash disbursements journal as $451. The NSF check for $500 was that of customer R. Koppa, deposited in April. Interest for April added to the account by the bank was $95. Required a. Prepare a bank reconciliation for Adam Company at April 30. b. Prepare the necessary journal entries to bring the Cash in Bank account into agreement with the reconciled cash balance on the bank reconciliation.
Transcribed Image Text:The Cash in Bank account balance on April 30 was $13,991. In reviewing checks returned by the bank, the accountant discovered that check No. 811, written for $541 for delivery expense, was recorded in the cash disbursements journal as $451. The NSF check for $500 was that of customer R. Koppa, deposited in April. Interest for April added to the account by the bank was $95. Required a. Prepare a bank reconciliation for Adam Company at April 30. b. Prepare the necessary journal entries to bring the Cash in Bank account into agreement with the reconciled cash balance on the bank reconciliation.
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