Question

Frederick Clinic deposits all cash receipts on the day when they are received and it makes all cash payments by check. At the close of business on June 30,2011, its cash account shows a $15,141 debit balance. Frederick Clinic's June 30 bank statement shows a $14,275 on deposit in the bank. a. Outstanding checks as of June 30 total $2,500 b. The June 30 bank statement included a $125 debit memorandum for bank services Check No. 919, listed with the canceled checks was correctly drawn for $645 in payment of a utility bill on June 15. Frederick mista kenly recorded it with a debit to Utilities Expense and a C. credit to Cash in the amount of $654 The June 30 cash receipts of $3,250 were placed in the bank's night depository after banking d. hours and were not recorded on the June 30 bank statement. Required: Prepare bank reconciliation for Frederick Clinic using the following information. Prepare the adjusting journal entries that Frederick Clinic must record as a result of the preparing the bank reconciliation.

Answer 1

Bank reconciliation statement :

Balance as per bank statement		$14275	Balance as per books		$15141
Add:			Add:
Cash receipts	$3250		Cheque no. 919	$9
		$3250			$9
Minus:			Minus :
Outstanding cheques	$2500		Bank services	$125
		($2500)			($125)
Reconciled balance		$15025			$15025

Adjusting journal entries:

Date	particulars	debit	credit
June 30, 2011	bank services	$125
	To cash		$125
	(being bank services expenses recorded
30 June, 2011	cash	$9
	To utilitities expenses		$9
	(being expenses recorded correctly)