On August 1, 2019, the accountant for Western Imports downloaded the company\'s

Question

On August 1, 2019, the accountant for Western Imports downloaded the company's July 31, 2019, bank statement from the bank's Website. The balance shown on the bank statement was $28,770. The July 31, 2019, balance in the Cash account in the general ledger was $14.131 Jenny Irvine, the accountant for Western Imports, noted the following differences between the bank's records and the company's Cash account in the general ledger: a. An electronic funds transfer for $14,500 from Foncier Ricard, a customer located in France, was received by the bank on July 31. b. Check 1422 was correctly written and recorded for $1,200. The bank mistakenly paid the check for $1,270. c. The accounting records indicate that Check 1425 was issued for $66 to make a purchase of supplies. However, examination of the check online showed that the actual amount of the check was for $96. d. A deposit of $890 made after banking hours on July 31 did not appear on the July 31 bank statement. e. The following checks were outstanding: Check 1429 for $1,250, and Check 1430 for $142. f. An automatic debit of $263 on July 31 from CentralComm for telephone service appeared on the bank statement but had not been recorded in the company's accounting records Requlred 1. Prepare a bank reconciliation for the firm as of July 31 2. Record general journal entries for the items on the bank reconiliation that must be journalized.

Explanation / Answer

Bank Reconciliation Statement July 31, 2019 Balance on bank statement 28770 Additions: Deposit of July 31 in transit 890 Check 1422 70 960 29730 Deductions: Check 1429 1250 Check 1430 142 Total deductions 1392 Adjusted bank balance 28338 Balance in books 14131 Additions: EFT received on account from Foncier Ricard 14500 28631 Deductions: Check 1425 30 Online payment on July 31 to CentralComm 263 293 Adjusted book balance 28338 1 Jul 31             Cash 14500                                  Accounts receivable/Foncier Ricard 14500 2 Jul 31             No journal entry required 3 Jul 31             Supplies 30                                 Cash 30 4 Jul 31             No journal entry required 5 Jul 31             No journal entry required 6 Jul 31             Telephone expense 263                                 Cash 263

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