Bank ReconciliationThe following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6:Cash balance according to the company's records at August 31, $25,520.Cash balance according to the bank statement at August 31, $26,850.Checks outstanding, $5,180.Deposit in transit, not recorded by bank, $4,160.A check for $480 in payment of an account was erroneously recorded in the check register as $840.Bank debit memo for service charges, $50.a. Prepare a bank reconciliation, using the format shown in Exhibit 13.Creative Design Co.Bank ReconciliationAugust 31, 20Y6Cash balance according to bank statement $fill in the blank - Select - - Select -Adjusted balance $fill in the blank Cash balance according to company's records $fill in the blank - Select - - Select -Adjusted balance $fill in the blank b. If the balance sheet were prepared for Creative Design Co. on August 31, what amount should be reported for cash?c. Must a bank reconciliation always balance (reconcile)?

Introduction: Bank Reconciliation statement: To reconcile the difference between bank book and cash…

Answered: The following data were accumulated for…

Corporate Financial Accounting

14th Edition

ISBN:9781305653535

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter7: Internal Control And Cash

Section: Chapter Questions

Problem 7.3BE

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Bank Reconciliation

The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6:

Cash balance according to the company's records at August 31, $25,520.
Cash balance according to the bank statement at August 31, $26,850.
Checks outstanding, $5,180.
Deposit in transit, not recorded by bank, $4,160.
A check for $480 in payment of an account was erroneously recorded in the check register as $840.
Bank debit memo for service charges, $50.

a. Prepare a bank reconciliation, using the format shown in Exhibit 13.

Creative Design Co.Bank ReconciliationAugust 31, 20Y6

Cash balance according to bank statement		$fill in the blank
		- Select -
		- Select -
Adjusted balance		$fill in the blank
Cash balance according to company's records		$fill in the blank
		- Select -
		- Select -
Adjusted balance		$fill in the blank

b. If the balance sheet were prepared for Creative Design Co. on August 31, what amount should be reported for cash?

c. Must a bank reconciliation always balance (reconcile)?

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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