5 The September 30 bank statement for Bennett Company and the September ledger a

Question

5 The September 30 bank statement for Bennett Company and the September ledger accounts for cash are summarized here BANK STAT Checks Deposits Balance, September1 Deposits recorded during September Checks cleared during September NSF checks-Betty Brown Bank service charges Balance, September 30 S 7,350 33,600 6,200 6,100 6,057 6,057 $ 26,250 $27,400 100 43 Cash (A 7,350 Sept. Checks written 29,000 29,500 Sept Deposits No outstanding checks and no deposits in transit were carried over from August, however, there are deposits in transit and checks outstanding at the end of September

Explanation / Answer

SOLUTION

1.

BENETTE COMPANY

Bank Reconciliation statement

*Ending balance per cash account = $7,350 + $29,000 - $29,500 = $6,850

2. Journal entry

3. Cash balance = $6,707

Company's Books Company's Books Bank Statement Bank Statement Particulars Amount ($) Particulars Amount ($) Ending balance per cash account* 6,850 Ending balance per bank statement 6,057 Additions- 0 Add: Deposit in transit ($29,000 - $26,250) 2,750 6,850 8,807 Deductions: Deduct: Bank service charges (43) Outstanding checks ($29,500 - $27,400) (2,100) NSF check – Betty Brown (100) Correct cash balance 6,707 Correct bank balance 6,707

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