Di Stefano Office Supply Company received a bank statement showing a balance of
ID: 2523771 • Letter: D
Question
Di Stefano Office Supply Company received a bank statement showing a balance of $70,005 as of March 31, 2019. The firm's records showed a book balance of $71,487 on March 31. The difference between the two balances was caused by the following items 1. A debit memorandum for $40, which covers the bank's collection fee for the note (item 6). 2. A deposit in transit of $4,700 3. A check for $348 issued by another firm that was mistakenly charged to Di Stefano's account. 4. A debit memorandum for an NSF check of $6,145 issued by Wozniak Construction Company, a credit customer 5. Outstanding checks: Check 3782 for $2.200; Check 3840 for $251 6. A credit memorandum for a $7,300 noninterest-bearing note receivable that the bank collected for the firm. Prepare a bank reconciliation statement for the firm as of March 31. Prepare the necessary journal entries for March 31, 2019 from the statementExplanation / Answer
SOLUTION:
Balance on bank statement 70,005 Additions: Deposit in transit 4700 Check incorrectly charged 348 5048 Deductions for outstanding checks: Check 3782 2200 Check 3840 251 Total outstanding checks 2451 Adjusted bank balance 72,602 Balance in books 71,487 Additions: Noninterest-bearing note collected by bank 7300 Deductions: Bank collection fee for note 40 NSF check from Wilson Construction Company 6145 6185 Adjusted book balance 72,602 Journal entries Cash 7,300 Notes Receivable 7,300 Miscellaneous Expense 40 Cash 40 Accounts Receivable/Wilson Construction Company 6145 Cash 6145