Problem 7-3A (Part Level Submission) On May 31, 2017, Reber Company had a cash b
ID: 2553031 • Letter: P
Question
Problem 7-3A (Part Level Submission) On May 31, 2017, Reber Company had a cash balance per books of $6,781.50. The bank statement from New York State Bank on that date showed a balance of $6,404.60. A comparison of the statement with the cash account revealed the following facts. 1. The statement included a debit memo of $40.00 for the printing of additional company checks 2. Cash sales of $836.15 on May 12 were deposited in the bank. The cash receipts journal entry and the deposit slip were incorrectly made for $886.15. The bank credited Reber Company for the correct amount. 3. Outstanding checks at May 31 totaled $576.25. Deposits in transit were $2,416.15 4. On May 18, the company issued check No. 1181 for $685 to Lynda Carsen on account. The check, which cleared the bank in May, was incorrectly journalized and posted by Reber Company for $658 5. A $3,000.00 note receivable was collected by the bank for Reber Company on May 31 plus $80.00 interest. The bank charged a collection fee of $20.00. No interest has been accrued 6. Included with the cancelled checks was a check issued by Stiner Company to Ted Cress for $800.00 that was incorrectly charged to Reber Company by the bank. 7. On May 31, the bank statement showed an NSF charge of $680.00 for a check issued by Sue Allison, a customer, to Reber Company on account.Explanation / Answer
Necessary adjusting Journal entries for Reber Company at May 31,2017 Date Account Titles and Explanation Debit Credit May.31 Cash $3,060.00 Bank Charges $20.00 Note Receivable $3,000.00 Interest Income $80.00 (to record note receivable) May.31 Accounts Receivable (Sue Allison) $680.00 Cash $680.00 (to record NSF check) May.31 Sales $50.00 Cash $50.00 (to record error in deposit) May.31 Accounts Payable (Lynda Carsen) $27.00 Cash $27.00 (to record error on check) May.31 Bank Charges $40.00 Cash $40.00 (to record check printing charge)