Harrison Company maintains a checking account at the First National City Bank. T

Question

Harrison Company maintains a checking account at the First National City Bank. The bank provides a bank statement along with canceled checks on the last day of each month. The July 2018 bank statement included the following information:

Balance, July 1, 2018 $55,803

Deposits 179,600

Checks processed (192,710)

Service charges (35)

NSF checks (1,250)

Monthly loan payment deducted directly by bank from account (includes $270 in interest). (3,370)

Balance, July 31, 2018. $38,038

The company’s general ledger account had a balance of $39,088 at the end of July. Deposits outstanding totaled $6,400 and all checks written by the company were processed by the bank except for those totaling $8,430. In addition, a $2,100 July deposit from a credit customer was recorded as a $210 debit to cash and credit to accounts receivable, and a check correctly recorded by the company as a $35 disbursement was incorrectly processed by the bank as a $350 disbursement.

Required:

1. Prepare a bank reconciliation for the month of July.

2. Prepare the necessary journal entries at the end of July to adjust the general ledger cash account.

Explanation / Answer

Prepare the necessary journal entries at the end of July to adjust the general ledger cash account.

Bank reconciliation for the month of July Balance As Per Bank statement 38038 Balance As Per BankCash Book 39088 Add Add Deposit in Transit 6400 Error in Recoding 2100-210 1890 Error in Recoding 350-35 315 6715 Deduct Deduct Check Outstanding 8430 8430 Service charges 35 NSF checks 1250 Loan repayment 3370 4655 36323 36323

Related Questions

Navigate

• Browse (All)
• Browse H
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.