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The December bank statement and cash T-account for Stewart Company follow: BANK STATEMENTDateChecksDepositsOtherBalanceDec. 1       $45,6006$7,600      38,00011 530$27,000    64,47017 12,900      51,57023   35,000    86,57026 530      86,04030 17,800 18,000NSF*$280 85,96031    Interest earned 60 86,02031    Service charge 130 85,890 * NSF check from J. Left, a customer. Cash (A)Dec. 1Balance45,600     Deposits  Checks written during December:Dec. 11 27,000  7,600  23 35,000  530  30 18,000  12,900  31 12,000  530       130       17,800       4,500  Dec. 31Balance93,610       There were no deposits in transit or outstanding checks at November 30. How would i make the following journal entries??-Record the interest of $60 received from the bank.-Record the service charges of $130 deducted by the bank.-Record the return of the J. Left check of $280 due to insufficient funds.-Earlier this month, a check in the amount of $4,500 was recorded as a reduction in cash. As of December 31, that check was still outstanding.-On December 31, a deposit of $12,000 was recorded, but the deposit was still in transit at the end of the month.

Question

The December bank statement and cash T-account for Stewart Company follow:

 

BANK STATEMENT

Date Checks Deposits Other Balance
Dec. 1               $ 45,600
6 $ 7,600             38,000
11   530 $ 27,000         64,470
17   12,900             51,570
23       35,000         86,570
26   530             86,040
30   17,800   18,000 NSF* $ 280   85,960
31         Interest earned   60   86,020
31         Service charge   130   85,890
 

* NSF check from J. Left, a customer.

 

Cash (A)
Dec. 1 Balance 45,600          
Deposits     Checks written during December:
Dec. 11   27,000     7,600    
23   35,000     530    
30   18,000     12,900    
31   12,000     530    
          130    
          17,800    
          4,500    
Dec. 31 Balance 93,610          

  

There were no deposits in transit or outstanding checks at November 30.

 

How would i make the following journal entries??

-Record the interest of $60 received from the bank.

-Record the service charges of $130 deducted by the bank.

-Record the return of the J. Left check of $280 due to insufficient funds.

-Earlier this month, a check in the amount of $4,500 was recorded as a reduction in cash. As of December 31, that check was still outstanding.

-On December 31, a deposit of $12,000 was recorded, but the deposit was still in transit at the end of the month.

check_circleAnswer
Step 1

Bank Reconciliation statement

 

Bank Reconciliation Statement is the statement which is prepared to overcome the discrepancies in the bank account as per bank records and cash account prepared by the firm. Under this, the entries in both the books, cash book, and bank passbook are compared and reconciled.

 

Journal Entries

 

Journal entry is a way to record the daily transactions of the business in the books of accounting. It comprises of two balances credit or debit and total of debit is always equal to the total of credit balance, in order to make a balanced journal entry.

Step 2

As the Interest revenue is an income, and there is an increase in income so being a nominal account, it will be credited and cash is an asset and it is also increasing so it will be debited.

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Step 3

As the service fee is an expense, and there is an increase in expense so being a nominal a...

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