Problem 8-1 Prepare bank reconciliation with necessary journal entry or entries

Question

Problem 8-1 Prepare bank reconciliation with necessary journal entry or entries (L.O. 4)
The following June 30, 2012, bank reconciliation pertains to Tiffany Company: Tiffany’s July bank statement follows:

The cash receipts deposited in July, including receipts of July 31, amounted to $5,178.30. Tiffany wrote these checks in July: No. 899-$ 18.86 No. 900-1,349.55 No. 901-27.75 No. 902-946.92 No. 903-59.70 No. 904-44.01 No. 905-1,093.50 No. 906-15.00 The cash balance per the ledger on July 31, 2012, was $30,766.37. The cash receipts deposited in July, including receipts of July 31, amounted to $5,178.30. Tiffany wrote these checks in July: No. 899-$ 18.86 No. 900-1,349.55 No. 901-27.75 No. 902-946.92 No. 903-59.70 No. 904-44.01 No. 905-1,093.50 No. 906-15.00 The cash balance per the ledger on July 31, 2012, was $30,766.37. Prepare a bank reconciliation as of July 31, 2012, and any necessary journal entry or entries to correct the accounts. Prepare a bank reconciliation as of July 31, 2012, and any necessary journal entry or entries to correct the accounts.
Cash Bank Balance, June 30 Add: Deposit not credited by bank Total Amount Statement $29,143.36 $28,644.31 942.60 $29,586.91 ess: Outstanding checks: No. 724 No. 886 No. 896 No. 897 No. 898 $18.45 15.00 143.55 187.65 78.90 443.55 $29,143.36 $29,143.36 Adjusted cash balance, June 30

Explanation / Answer

SOLUTION

(A) Bank Reconciliation statement-

(1) Deposits in transit-

(2) Outstanding checks-

(B) Journal Entry-

Particulars Amount ($) Particulars Amount ($) Balance per bank statement 31,158.38 Balance as per books 30,766.37 Add: Deposit in transit (1) 678.96 Less: NSF Checks (139.98) 31,837.34 Less: Outstanding checks (2) (1,210.95) Adjusted bank balance 30,626.39 Adjusted book balance 30,626.39

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