Question

The cash balance per books for the Senjavarah Company on October 31, 2019 is $8,736.01. The following cheques and receipts were recorded for the month of October, 2019:

​Cheques​​​Receipts​

No.​ Amount​No.​ Amount​ Amount​Date

17​$372.96​22​$ 578.84​$843.86​Oct. 5

18​$780.62​23​$1,687.50​$941.54​Oct. 21

19​$157.00​24​$ 921.30​$808.58​Oct. 27

20​$587.50​25​$ 246.03​$967.00​Oct. 30

21​$234.15

In addition, the bank statement for the month of October is presented below:

​Cheques and other debits ​Deposits​Date​Balance

​—————————————————————————————————————————

​No.​Amount​No.​Amount​No.​Amount

​—————————————————————————————————————————

​​​​​​​​Sep 30​$5,404.84

​14​$148.29​17​$372.96​22​$578.84​$5,484.38​Oct 1​$9,789.13

​18​708.62​24​921.30​​​843.86​Oct 8​$9,003.07

​19​157.00​25​246.03​​​941.54​Oct 23​$9,541.58

​21​234.15​​15.00​SC​​808.58​Oct 29​$10,101.01

​​250.00​NSF​​​​1,200.00​CM​Oct 31​$11,051.01

​—————————————————————————————————————————

​Symbols: NSF (Not sufficient funds) SC (Service charge) CM (Credit memo)

Cheque No. 18 was correctly written for $708.62 for a payment on account. The NSF cheque was from S. Horn, a customer, in settlement of an accounts receivable. An entry had not been made for the NSF cheque. The credit memo is for an EFT from a customer account.

Instructions

a)​Prepare a bank reconciliation at October 31, 2019 in good format. Include a heading.

b)​Prepare the adjusting journal entries required by the bank reconciliation on Oct 31st.

The cash balance per books for the Senjavarah Company on October 31, 2019 is $8,736.01. The following cheques and receipts were recorded for the month of October, 2019:

​Cheques​​​Receipts​

No.​ Amount​No.​ Amount​ Amount​Date

17​$372.96​22​$ 578.84​$843.86​Oct. 5

18​$780.62​23​$1,687.50​$941.54​Oct. 21

19​$157.00​24​$ 921.30​$808.58​Oct. 27

20​$587.50​25​$ 246.03​$967.00​Oct. 30

21​$234.15

In addition, the bank statement for the month of October is presented below:

​Cheques and other debits ​Deposits​Date​Balance

​—————————————————————————————————————————

​No.​Amount​No.​Amount​No.​Amount

​—————————————————————————————————————————

​​​​​​​​Sep 30​$5,404.84

​17​$372.96​22​$578.84​$5,484.38​Oct 1​$9,789.13

​18​708.62​24​921.30​​​843.86​Oct 8​$9,003.07

​19​157.00​25​246.03​​​941.54​Oct 23​$9,541.58

​21​234.15​​15.00​SC​​808.58​Oct 29​$10,101.01

​​250.00​NSF​​​​1,200.00​CM​Oct 31​$11,051.01

​—————————————————————————————————————————

​Symbols: NSF (Not sufficient funds) SC (Service charge) CM (Credit memo)

Cheque No. 18 was correctly written for $708.62 for a payment on account. The NSF cheque was from S. Horn, a customer, in settlement of an accounts receivable. An entry had not been made for the NSF cheque. The credit memo is for an EFT from a customer account.

Instructions

a)​Prepare a bank reconciliation at October 31, 2019 in good format. Include a heading.

b)​Prepare the adjusting journal entries required by the bank reconciliation on Oct 31st.

Answer 1

a.

Senjavarah Company Bank Reconciliation Statement October 31, 2019
Balance as per Bank		$ 11,051.01	Balance as per Books		$ 8,736.01
Add: Deposits in Transit	$ 967		Add: Error in writing check	$ 72
		967	EFT credit	1,200	1,272
		12,018.01			10,008.01
Less: Outstanding checks			Less:
Ch. # 20	587.50		Service Charge	15
Ch. # 23	1,687.50		NSF check	250
		2,275			265
Cash balance as per Bank		9,743.01	Cash balance as per Books		9,743.01

b. In the books of Senjavarah Company:

Date	Accounts	Debit	Credit
		$	$
Oct 31, 2019	Cash	72
	Accounts Payable		72
	To correct error in recording check
Oct 31, 2019	Cash	1,200
	Accounts Receivable		1,200
	EFT from customer account
Oct 31, 2019	Accounts Receivable	250
	Cash		250
	To record NSF check
Oct 31, 2019	Bank Service Charge Expense	15
	Cash		15
	To record bank service charges for the period

Answer 2

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