The cash account for American Medical Co. at April 30 indicated a balance of $14,350. The bank statement indicated a balance of $16,340 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:Checks outstanding totaled $5,880.A deposit of $6,130, representing receipts of April 30, had been made too late to appear on the bank statement.The bank collected $3,190 on a $3,020 note, including interest of $170.A check for $880 returned with the statement had been incorrectly recorded by American Medical Co. as $800. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account.A check drawn for $90 had been erroneously charged by the bank as $900.Bank service charges for April amounted to $60.Required:1. Prepare a bank reconciliation.

Answered: cash account for American Medical Co.…

Century 21 Accounting Multicolumn Journal

11th Edition

ISBN:9781337679503

Author:Gilbertson

Publisher:Gilbertson

Chapter5: Cash Control Systems

Section: Chapter Questions

Problem 2AP

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The cash account for American Medical Co. at April 30 indicated a balance of $14,350. The bank statement indicated a balance of $16,340 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:

Checks outstanding totaled $5,880.
A deposit of $6,130, representing receipts of April 30, had been made too late to appear on the bank statement.
The bank collected $3,190 on a $3,020 note, including interest of $170.
A check for $880 returned with the statement had been incorrectly recorded by American Medical Co. as $800. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account.
A check drawn for $90 had been erroneously charged by the bank as $900.
Bank service charges for April amounted to $60.

Required:

1. Prepare a bank reconciliation.

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Bank reconciliation statement reconciles the cash balance of the bank with the cash balance of the company

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