Question

[The following information applies to the questions displayed below. The bookkeeper at Martin Company has asked you to prepare a bank reconciliation as of May 31. The May 31 bank statement and the May T-account for cash (summarized) Martin Company's bank reconciliation at the end of April showed a cash balance of $19,700. No deposits were in transit at the end of April, but a deposit was in transit at the end of May. BANK STATEMENT Deposits Checks Other Balance $ 19,700 Balance, May 1 May 2 May 5 May 7 May 8 May 14 May 17 May 22 May 27 May 31 Balance, May 31 $ 8,000 27,700 16,700 10,300 20,300 19,78e 19,920 19,620 14,820 14,750 14,750 # 301 #302 $ 11,000 6,400 1e,000 # 303 520 Interest $140 3ee NSF check #304 4,80e Service charge 7e Cash (A) 19,7ee 8,eee 10, eee 6,400 May 1 Balance May 1 May 7 May 29 11,eee 6,400 520 #301 May 2 #302 May 4 #303 May 11 #304 May 23 #305 May 29 4,800 1,500 May 31 Balance 19,880 Required:

Answer 1

Bank reconciliation statement is a statement which reconcile bank balance the books of entity with actual bank balance as per bank.

Martin company Bank reconciliation At May 31 Companys books $ 14,750 Ending balance as per cash account Bank statement Ending balance as per bank statement $ 19,880 Addition: Deposit in transit Addition: 6,400 Interest earned $ 6,400 $ $ 140 $ 140 Deductions: Outstanding cheque $ -1,500 $ Deductions: -1,500 NSF Cheque Bank service charges $ $ -300 -70 $ -370 Up to date cash balance $ 19,650 Up to date cash balance $ 19,650