*Problem 7-3A On July 31, 2014, Redeker Company had a cash balance per books of
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*Problem 7-3A On July 31, 2014, Redeker Company had a cash balance per books of $6,435. The statement from Nashota State Bank on that date showed a balance of $7,985.80. A comparison of the bank statement with the Cash account revealed the following facts. 1. The bank service charge for July was $21. 2. The bank collected a note receivable of $1,697 for Redeker Company on July 15, plus $34 of interest. The bank made a $14 charge for the collection. Redeker has not accrued any interest on the note. 3. The July 31 receipts of $1,394.30 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 T. Laird, a creditor, for $364.00 that cleared the bank in July was incorrectly entered Snly ot thenk statenent howed an tsf cherge of $772 for a check received by the company from k. Wagner. in the cash payments journal on July 10 for $346.00. 5. Checks outstanding on July 31 totaled $2,039.10. 6. On July 31, the bank statement showed an NSF charge of $772 for a check received by the company from K. Wagner,a customer, on account.Explanation / Answer
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Part B)
The journal entries are as follows:
REDEKER COMPANY Bank Reconciliation 31st July 2014 Balance Per Bank Statement 7,985.8 Add Deposits in Transit 1,394.3 9,380.1 Less Checks Outstanding 2,039.1 Adjusted Bank Balance $7,341 Cash Balance Per Books 6,435 Add Collection of Accounts Receivable with Interest 1,731 8,166 Less Bank Service Charge (21+14) 35 NSF Charge 772 Error Correction (364 – 346) 18 825 Adjusted Cash Balance $7,341Related Questions
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