Question

sos de estuual method to estimate the stand-alone selling price of the workstatt the discount coupon. Show all work to receive full credit. Problem 4 gerald Company maintains a checking account at the Bank of the North. The bank provides a bank statement along with canceled checks on the last day of each month. The October 31, 2018, bank statement included the following information: Balance, October 1, 2018 $ 32,690 86,000 e on the Deposits Checks processed Service charges NSF checks Monthly loan payment deducted directly by bank from account (includes $400 in interest) (75,200) (350) (1,600) s with their (3,400 Balance, October 31, 2018 $ 38,140 The company's general ledger cash (checking) account had a balance of $42,544 at the end of October. Deposits outstanding totaled $4,224, and all checks written by the company were processed by the bank except for those totaling $5,620. In addition, a check for $500 for the purchase of office furniture was incorrectly recorded by the company as a $50 disbursement. The bank correctly processed the check during October Required: 1. Prepare a bank reconciliation for the month of October. 2. Prepare the necessary journal entries at the end of October to adjust the general ledger cash account.

Answer 1

Bank Reconciliation is a process of identifying the difference that exist between the company's bank balance as per bank statement supplied by bank and cash balance as per company's accounting records. FITZGERAL COMPANY Bank Reconciliation Oct 31 Amount Amount Journal Entry Particulars Bank Balance Oct, 31 Add: Deposit in Transit $38,140 Credit 1 $4,224 $42,364 $3,400 $5,620 $450 Deduct: Outstanding Checks Total Deduction Adjusted Bank Balance Cash Balance Oct, 31 Add: ($5,620) $36,744 Sr.No Date Particulars Debit Oct 31 Notes Payable $3,000 Interest Expense $400 Cash (To record repayment of notes payable and interest expense) 2 Oct 31 Furniture $450 Cash (To record rectification entry) 3 Oct 31 Accounts Receivable $1,600 Cash (To Record NSF check) Oct 31 Bank Charges $350 Cash (To Record bank service charges) Note : No entry is equired for Deposit in transit and outstanding checks $42,544 $1,600 $42,544 $350 $3,000 $400 Deduct: Loan Repayment Interest on loan Error in posting ($500-$50] NSF Check Bank Service Charge Total Deduction Adjusted Book Balance $450 $1,600 $350 ($5,800) $36,744