Adjusting Entry from Bank ReconciliationPyramid Corporation is assessed a $40 fee as the result of a $126 NSF check received from a customer for services purchased on account. Neither the fee nor the NSF check has been accounted for on Pyramid's books.Required:Record the appropriate journal entry to update Pyramid's books. If an amount box does not require an entry, leave it blank

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Asked Oct 7, 2019
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Adjusting Entry from Bank Reconciliation

Pyramid Corporation is assessed a $40 fee as the result of a $126 NSF check received from a customer for services purchased on account. Neither the fee nor the NSF check has been accounted for on Pyramid's books.

Required:

Record the appropriate journal entry to update Pyramid's books. If an amount box does not require an entry, leave it blank

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Expert Answer

Step 1

A Bank Reconciliation Statement is prepared to reconcile the balances of the Cash book maintained by the company and the Bank records. Any differences in the balances are adjusted through an adjustment entry.

Step 2

In the given case, a check of $126 NSF received from customer and bank fees of $40 was not accounted for in the books of account. Therefore, a...

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