6. The Cash account of Safe and Secure Security Systems reported a balance of $2

Question

6. The Cash account of Safe and Secure Security Systems reported a balance of $2,490 at May 31, 2011. There were outstanding checks totaling $500 and a May 31 deposit in transit of $300. The bank statement, which came from Tri Cities Bank, listed the May 31 balance of $3,360. Included in the bank balance was a collection of $680 on account from Ryan Saar, a Safe and Secure customer who pays the bank directly. The bank statement also shows a $20 service charge and $10 of interest revenue that Safe and Secure earned on its bank balance.

R1. Prepare Safe and Securer

Explanation / Answer

The journal entries for reconciliation are: Debit Credit 1. Cash in transit 300 Bank A/c 300 2. Bank A/c 500 Cheques Outstanding 500 3. Bank A/c 680 Ryan Saar 680 4. Service Charges 20 Bank A/c 20 5. Bank A/c 10 Interest Income 10 Please consider the time devoted to make this reply by rating this answer as 5star. Thank u in advance. God bless u :)

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