One Trick Pony Company, Inc. received their bank statement for October 31, 2014,
ID: 2473620 • Letter: O
Question
One Trick Pony Company, Inc. received their bank statement for October 31, 2014, showing a balance of $11,073. Prepare the bank statement in good form, given the following information: General Ledger Cash Balance is shown as $12,606. One Trick made a deposit on October 31 of $1, 250 which is not shown on the statement. There are three outstanding checks, 5587 $186, 5588 $85 and 5595 $175. The bank acts as the collection agency for interest earned on One Trick investments. The statement revels $465 was collected during the month, but not recorded. There is a bank charge of $50, and interest earned of $55. A check from Dead Beat, Inc. in the amount of $166 was returned for NSF. A deposit of $123 was not on the bank statement. Investigation revealed that the bank credited the account of Tricky Fishy for the deposit. Another deposit in the amount of $ 101 was made, however the new accountant recorded the amount on the books as $ 1,011. Prepare any necessary adjusting entries. What is the correct cash balance to be shown on the Balance Sheet?Explanation / Answer
Bank Reconciliation Statement as on October 31, 2014
Balance as per Bank Statement $ 11,073.00
Add:
Cheque deposited but not credited $ 1,250.00
Bank errors $ 910.00
($ 1011 - $ 101)
Sub total $ 13,233.00
Less:
Outstanding cheques $ 446.00
Adjusted cash balance $ 12,787.00
Balance as per Cash book $ 12,606.00
Add:
Interest earned $ 55.00
Collections by the Bank $ 465.00
Sub total $ 13,126.00
Less:
NSF Cheques $ 166.00
Deposit not in the bank statement $ 123.00
Bank charges $ 50.00
Adjusted cash balance $ 12,787.00
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