Bank reconciliation and entries Instructions Chart of Accounts Amount Descriptions Bank Reconciliation Journal Final Question Instructions The cash account for American Medical Co. at April 30 indicated a balance of $334,985. The bank statement indicated a balance of $388,600 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:A. Checks outstanding totaled $61,280.B. A deposit of $42,500, representing receipts of April 30, had been made too late to appear on the bank statement.C. The bank collected $42,000 on a $40,000 note, including interest of $2,000.D. A check for $7,600 returned with the statement had been incorrectly recorded by American Medical Co. as $760. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account.E. A check drawn for $240 had been erroneously charged by the bank as $420.F. Bank service charges for April amounted to $145. Instructions1. Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. “Deduct:” or “Add:” will automatically appear if it is required.2. Journalize the necessary entries. The accounts have not been closed. Refer to the Chart of Accounts for exact wording of account titles.3. If a balance sheet is prepared for American Medical Co. on April 30, what amount should be reported as cash? Chart of Accounts CHART OF ACCOUNTSAmerican Medical Co.General Ledger ASSETS110Cash111Petty Cash120Accounts Receivable131Notes Receivable141Merchandise Inventory145Office Supplies146Store Supplies151Prepaid Insurance181Land191Office Equipment192Accumulated Depreciation-Office Equipment193Store Equipment194Accumulated Depreciation-Store Equipment LIABILITIES211Accounts Payable-Targhee Supply Co.221Notes Payable222Interest Payable231Salaries Payable241Sales Tax Payable EQUITY310Owner, Capital311Owner, Drawing312Income Summary REVENUE410Sales610Interest Revenue EXPENSES510Cost of Merchandise Sold515Credit Card Expense516Cash Short and Over520Salaries Expense531Advertising Expense532Delivery Expense533Insurance Expense534Office Supplies Expense535Rent Expense536Repairs Expense537Selling Expenses538Store Supplies Expense561Depreciation Expense-Office Equipment562Depreciation Expense-Store Equipment590Miscellaneous Expense710Interest Expense Amount Descriptions Amount Descriptions Bank error in charging check as $240 instead of $420 Bank error in charging check as $420 instead of $240 Bank service charges Check for $420 returned because of insufficient funds Deposit of April 30, not recorded by bank Error in recording check Error in recording April 30 deposit Outstanding checks Note and interest collected by bank
Bank reconciliation and entries
Instructions Chart of Accounts Amount Descriptions Bank Reconciliation Journal Final Question
Instructions
The cash account for American Medical Co. at April 30 indicated a balance of $334,985. The bank statement indicated a balance of $388,600 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:
A.
Checks outstanding totaled $61,280.
B.
A deposit of $42,500, representing receipts of April 30, had been made too late to appear on the bank statement.
C.
The bank collected $42,000 on a $40,000 note, including interest of $2,000.
D.
A check for $7,600 returned with the statement had been incorrectly recorded by American Medical Co. as $760. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account.
E.
A check drawn for $240 had been erroneously charged by the bank as $420.
F.
Bank service charges for April amounted to $145.
Instructions
1.
Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. “Deduct:” or “Add:” will automatically appear if it is required.
2.
Journalize the necessary entries. The accounts have not been closed. Refer to the Chart of Accounts for exact wording of account titles.
3.
If a balance sheet is prepared for American Medical Co. on April 30, what amount should be reported as cash?
Chart of Accounts
CHART OF ACCOUNTS
American Medical Co.
General Ledger
ASSETS
110
Cash
111
Petty Cash
120
Accounts Receivable
131
Notes Receivable
141
Merchandise Inventory
145
Office Supplies
146
Store Supplies
151
Prepaid Insurance
181
Land
191
Office Equipment
192
193
Store Equipment
194
Accumulated Depreciation-Store Equipment
LIABILITIES
211
Accounts Payable-Targhee Supply Co.
221
Notes Payable
222
Interest Payable
231
Salaries Payable
241
Sales Tax Payable
EQUITY
310
Owner, Capital
311
Owner, Drawing
312
Income Summary
REVENUE
410
Sales
610
Interest Revenue
EXPENSES
510
Cost of Merchandise Sold
515
Credit Card Expense
516
Cash Short and Over
520
Salaries Expense
531
Advertising Expense
532
Delivery Expense
533
Insurance Expense
534
Office Supplies Expense
535
Rent Expense
536
Repairs Expense
537
Selling Expenses
538
Store Supplies Expense
561
Depreciation Expense-Office Equipment
562
Depreciation Expense-Store Equipment
590
Miscellaneous Expense
710
Interest Expense
Amount Descriptions
Amount Descriptions
Bank error in charging check as $240 instead of $420
Bank error in charging check as $420 instead of $240
Bank service charges
Check for $420 returned because of insufficient funds
Deposit of April 30, not recorded by bank
Error in recording check
Error in recording April 30 deposit
Outstanding checks
Note and interest collected by bank
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