question archive The cash account for Brentwood Bike Co
Subject:AccountingPrice: Bought3
The cash account for Brentwood Bike Co. at May 1, 2016, indicated a balance of $34,800. During May, the total cash deposited was $139,523, and checks written totaled $138,774. The bank statement indicated a balance of $43,875 on May 31. Comparing the bank statement, the canceled checks, and the accompanying memos with the records revealed the following reconciling items:
A. | Checks outstanding totaled $6,340. |
B. | A deposit of $1,643 representing receipts of May 31, had been made too late to appear on the bank statement. |
C. | The bank had collected for Brentwood Bike Co. $5,565 on a note left for collection. The face of the note was $5,300. |
D. | A check for $260 returned with the statement had been incorrectly charged by the bank as $620. |
E. | A check for $210 returned with the statement had been recorded by Brentwood Bike Co. as $120. The check was for the payment of an obligation to Adkins Co. on account. |
F. | Bank service charges for May amounted to $22. |
G. | A check for $1,464 from Jennings Co. was returned by the bank due to insufficient funds. |
Instructions | |
1. | Prepare a bank reconciliation as of May 31. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. “Deduct:” or “Add:” will automatically appear if it is required. |
2. | Journalize the necessary entries. The accounts have not been closed. Refer to the Chart of Accounts for exact wording of account titles. |
3. | If a balance sheet were prepared for Brentwood Bike Co. on May 31, 2016, what amount should be reported as cash? |