The cash account of Windsor Co. showed a ledger balance of $20,340.82 on June 30

Question

The cash account of Windsor Co. showed a ledger balance of $20,340.82 on June 30, 2017. The bank statement as of that date showed a balance of $21,580.00. Upon comparing the statement with the cash records, the following facts were determined. 1. There were bank service charges for June of $130.00. 2. A bank memo stated that Bao Dai’s note for $6,240.00 and interest of $187.20 had been collected on June 29, and the bank had made a charge of $28.60 on the collection. (No entry had been made on Windsor’s books when Bao Dai’s note was sent to the bank for collection.) 3. Receipts for June 30 for $17,628.00 were not deposited until July 2. 4. Checks outstanding on June 30 totaled $11,107.46. 5. The bank had charged the Windsor Co.’s account for a customer’s uncollectible check amounting to $1,316.64 on June 29. 6. A customer’s check for $468.00 (as payment on the customer’s Accounts Receivable) had been entered as $312.00 in the cash receipts journal by Windsor on June 15. 7. Check no. 742 in the amount of $491.00 had been entered in the cash journal as $419.00, and check no. 747 in the amount of $302.64 had been entered as $3,026.40. Both checks had been issued to pay for purchase of equipment and were payments on Windsor’s Accounts Payable. Prepare entries necessary to make the books correct and complete

Explanation / Answer

20,340.82 balance per books

(130.00). 1. Bank services charge

6240.00. 2.memo dai note collected

187.20. Interest earned

(28.60). Bank service charge

(17,628.00) 3.deposit in transist

11,107.46. 4.checks out standing

(1316.64). 5.bounced check

156.00. 6.error in posting

(72.00). 7. Ch# 491 entered 419

(2723.70). 302.64 entered 3026.40

Bang balance. 21,580.00

Evaluate each item

1- Debit: Bank fees- 130.00

Credit: Cash- 130.00

2- Debit: Cash- 6240.00

Credit: Notes payable- 6240.00

Debit: Cash- 187.20

Credit: Int income - 187.20

Debit: Bank fees-28.60

Credit: Cash -28.60

3- Debit: Cash-17.628.00

Credit: Sales- 17,628.00

4- Entry not necessary

5- Debit: Ar 1316.14

Credit: cash- 1316.14

6- Debit: Cash -156.00

Credit: Ar - 156.00

7- Debit: equip. -72.00

Credit: Cash. -72.00

Debit: Cash- 2723.70

Credit- 2723.70

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