Question

Required information The following information applies to the questions displayed below.) The August, current year, bank statement for Allison Company and the August, current year, ledger account for cash follow: BANK STATEMENT Checks and EPIS Deposits Date Aug. 1 2 $ 410 $11,950 475 305 870 185 EFT Balance $18,310 17.900 29,850 29,375 29,070 28, 200 28,015 32.465 32, 150 11,750 18,100 17,650 20,800 20,685 4,450 315 24 $20,400 25 30 6,650 250 EFT 115 - 1.150 31 $3,150 interest collected. TBank service charge. Aug. 1 Balance Deposits Aug. 2 12 Cash (A) Cheeks written and 17,120 electronic funds transfers Aug. 2 11,950 4.450 6.650 5,950 EIT 185 230 17 20 FET 750 315 20,400 23 Outstanding checks at the end of July were for $305, $475, and $410. No deposits were in transit at the end of July. Required: 1. Compute the deposits in transit at the end of August by comparing the deposits on the bank statement to the deposits listed on the cash ledger account. Deposits in transit 2. Compute the outstanding checks at the end of August by comparing the checks listed on the bank statement with those on the cash ledger account and the list of outstanding checks at the end of July. Outstanding checks 3. Prepare a bank reconciliation for August. ALLISON COMPANY Bank Reconciliation, August 31, Current Year Company's Books Bank Statement Ending balance per cash account Ending balance per bank statement Additions: Additions: Deductions: Deductions: Correct cash balance Correct cash balance 5. What total amount of cash should be reported on the August 31, Current Year, balance sheet? Total amount of cash

Answer 1

1)	Deposits in transit		5,950
2)	outstanding checks		690
3)		ALLISON COMPANY
	Company’s Books				Bank statement
	Ending balance per cash account			22910	Ending balance per bank statement				20,685
	Addittions				Addittions
	interest revenue			3,150	Deposit in transit				5,950
				26,060					26,635
	Deductions:				Deductions:
	bank service charge			115	Checks oustanding				690
	Correct cash balance			25,945	Correct cash balance				25,945
	(note cash end balance will be opening+deposits- withdrawals)
4)	General Journal					Debit	Credit
	Cash					3,150
	interest revenue						3,150
	Bank service charge expense					115
	cash						115
5)	Total amount of cash			25,945