Question

2) Bank Reconciliation (15 Points) Watson Corporation's September 30 cash balance per their bank statement was $9.100 Their September 30 cash balance per their books was 9,336. Deposits in transitat September JO are $2.350 and outstanding checks at September 30 total 51.100. There were bank service charges for September of SIS. A bank memo received with the bank statement indicated that a note from one of Watson's customers for $1.000 and interest of $20 had been collected on September 28 (Watson was not aware of this collection until they had received the bank statement Watson's hookkener imponerly entered one check in the books at 5154 which was written for $145 for utilities : cleared the bank during the month of September Required: Prepare a two-section bank reconciliation dated September 30, with each section proceeding to a correct balance 11) Prepare any journal entries necessary to make Watson's books correct and complete B 9374 D -o 2,250 lloo 10586 utilities exp 145 cash 145

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Answer 1

i)	Warson Corporation's
	Bank Reconciliation Statement
	Month Ended September 30
	Cash Balance as per bank statement	9100
	Add: Deposit in Transit	2350
	Less: Outstanding checks	-1100
	Adjusted Cash Balance	10350
	Cash balance as per books	9336
	Add: Receivable Collected	1000
	Interest Collected	20
	Error rectification	9
	Less: Bank Service charges	-15
	Adjusted Cash Balance	10350
ii)	Journal entry
	Account NAME	Debit	Credit
	Bank A/c Dr.	1014
	Bank Charges	15
	To Accounts Receivable		1000
	To Interest Income		20
	To Utilities Expense		9
	(being adjustment entry passed)