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Problem #6016; Bank Reconciliation OBJECTIVE
The cash account of Dixon Products reveals the following information:
Balance 480 H.300
Deposits during May 31600 4L620 Chocks written during May SHOW ME H01!
The bank statement for May contains the following information:
Bank balance, 450 $ 11.75!)
Add: Deposits during May 37.250
55 49.000
Less: Checks paid during May $140,230]
NSF check from Fmiin Inc. (190]
Bank service charges (40] [40460)
Bank balance, SBI $ 8,540
(Continued)
A mmpafison of detailed company records with the bank statement indicates the following Mommfion:
Al 4.50 At 531
Deposit in transit $800 Shift
Outstanding chocks T50 2‘E40
The bank amounts are determined to be correct.
Required:
1. Prepare a bank reconciliation for May.
2. Prepare the adjusting entries made by Dixon as a result of the reconciliation process.
3. What amount is reported for cash on the balance sheet at May 31?
Concept Introduction:
Bank Reconciliation:
Bank reconciliation is the process in which the entity reconciles its cash entries in accounts with the entries in bank statement issued by the bank. The entity prepares bank reconciliation statement and it has two sides; Bank Side and Cash side.
Requirement-1:
To Prepare:
The Bank reconciliation Statement.
The Bank reconciliation Statement is explained as follows:
| Dixon Products | |||||
| Bank Reconciliation | |||||
| As of July 31 | |||||
| Bank Side | Book Side | ||||
| Balance as per Bank statement | $ 8,540 | Balance as per Cash Book (11800+37600-41620) | $ 7,780 | ||
| Add: | Add: | ||||
| Deposit in transit | |||||
Concept Introduction:
Bank Reconciliation:
Bank reconciliation is the process in which the entity reconciles its cash entries in accounts with the entries in bank statement issued by the bank. The entity prepares bank reconciliation statement and it has two sides; Bank Side and Cash side.
Requirement-2:
To Prepare:
The necessary adjusting entries.
Concept Introduction:
Bank Reconciliation:
Bank reconciliation is the process in which the entity reconciles its cash entries in accounts with the entries in bank statement issued by the bank. The entity prepares bank reconciliation statement and it has two sides; Bank Side and Cash side.
Requirement-3:
To Indicate:
The amount of cash to be reported on balance sheet.
Chapter 4 Solutions
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