Question

On July 31, 2017, Keeds Company had a cash balance per books of $6,140.00. The statement from Dakota State Bank on that date showed a balance of $7,690.80. A comparison of the bank statement with the Cash account revealed the following facts.
1. The bank service charge for July was $25.00.
2. The bank collected $1,520.00 for Keeds Company through electronic funds transfer.
3. The July 31 receipts of $1,193.30 were not included in the bank deposits for July. These receipts were deposited by the company in a night deposit vault on July 31.
4. Company check No. 2480 issued to L. Taylor, a creditor, for $384.00 that cleared the bank in July was incorrectly entered in the cash payments journal on July 10 for $348.00.
5. Checks outstanding on July 31 totaled $1,860.10.
6. On July 31, the bank statement showed an NSF charge of $575.00 for a check received by the company from W. Krueger, a customer, on account.
Required:
a. Prepare the bank reconciliation as of July 31.
b. Prepare the necessary adjusting entries at July 31.

Answer 1

Answer:

cash                            884 debit

bank service expense 25 debit

account payable          36 debit

Account receivable          945 credit

--to adjust for bank statmenet reconciliation--

Explanation:

CASH

Balance               6140

Service Charge  -25

mistake                   -36

NSF                  -575

collection          1520

Adjusted Balance 7024

BANK

Balance                     7690.8

Outstanding Check    -1860.1

Deposit in transit      1193.3

Adjusted Balance     7024

Each statmenet is adjusted by the unknow information.

The comapny adjust for the bank service charge, their accounting mistake, the collection in their behalf and the non.sufficient fund check

Answer 2

The Bank Reconciliation Statement is the financial statement prepared by the accountants at the end of the period when they receive the bank passbook. The statement is prepared to rectify the mistake or mismatch between the cash book balance and the passbook balance.

The adjusting entries are the year-end journal entries recorded to rectify the errors or the incomes or expenditures those are not of the current period.

The bank reconciliation statement and the adjusting entries are shown in the image attached below.

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