Chapter 6, Problem 4PSA

1.

To determine

To prepare: Bank reconciliation of B Company as at July 31, 2017.

2.

To determine

To prepare: Journal entries to bring the company’s book balance of cash into conformity with the reconciled cash balance as of July 31, 2017.

a.

To determine

To explain: effect on (i) the adjusted bank statement cash balance and (ii) the adjusted cash account book balance related to company’s unadjusted cash account balance of $27,497 which is listed on the reconciliation as $27,947.

b.

To determine

To explain: effect on (i) the adjusted bank statement cash balance and (ii) the adjusted cash account book balance related to the bank’s collection of $8,000 less collection fee which is added to the bank statement cash balance on the reconciliation.