33McDermott Company's bank statement for September 30 showed an ending cash balance of $1,364. The company's Cash account in its general ledger showed a $1,010 debit balance.The following information was also available as of September 30.The bank deducted $130 for an NSF check from a customer deposited on September 15.The September 30 cash receipts, $1,260, were placed in the bank's night depository after banking hours on that date and this amount did not appear on the September 30 bank statement.A $16 debit memorandum for checks printed by the bank was included with the canceled checks.Outstanding checks amounted to $1,160.Included with the bank statement was a credit memo in the amount of $880 for an EFT in payment of a customer’s account.Included with the canceled checks was a check for $280, drawn on the account of another company. Required:Prepare a bank reconciliation as of September 30.Prepare the journal entries for the items on the company’s bank reconciliation as of September 30.

Bank reconciliation: It is a statement drawn up by the business to verify the cash book balance with…

Answered: McDermott Company's bank statement for…

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter6: Bank Accounts, Cash Funds, And Internal Controls

Section: Chapter Questions

Problem 1PA

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McDermott Company's bank statement for September 30 showed an ending cash balance of $1,364. The company's Cash account in its general ledger showed a $1,010 debit balance.

The following information was also available as of September 30.

The bank deducted $130 for an NSF check from a customer deposited on September 15.
The September 30 cash receipts, $1,260, were placed in the bank's night depository after banking hours on that date and this amount did not appear on the September 30 bank statement.
A $16 debit memorandum for checks printed by the bank was included with the canceled checks.
Outstanding checks amounted to $1,160.
Included with the bank statement was a credit memo in the amount of $880 for an EFT in payment of a customer’s account.
Included with the canceled checks was a check for $280, drawn on the account of another company.

Required:

Prepare a bank reconciliation as of September 30.
Prepare the journal entries for the items on the company’s bank reconciliation as of September 30.

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