QUESTION 2-BANK RECONCILIATION The following information is given for Christmas

Question

QUESTION 2-BANK RECONCILIATION The following information is given for Christmas Lights Inc. for the month of December 2017 On December 31st after all posting was complete, its cash account showed a $11,322 debit balance. However, Christmas Lights' December 31st bank statement showed only $9,930 on deposit in the bank on that day b. Christmas Lights deposits all receipts on the same day received. Outstanding c. Included with the December cancelled cheques from the bank was an $81 debit d. On December 31st, cash receipts of $3,835 were placed in the bank's night e. A cheque was written to Logical Inc. for Internet Services in the amount of $500; cheques totalled $2,824. memorandum for bank service charges depository after banking hours on that date and were unrecorded by the bank at the time the December bank statement was prepared however the accounts clerk recorded a debit to Internet expense and a credit to cash in the amount of $600 not the correct amount of $500. The bank cashed it for the correct amount of $500. f. Mr. Snow's cheque in the amount of $400 to pay off his account was returned by Task: 2. Journalized the necessary entries to bring the cash account up-to-date. the bank for NSF (non-sufficient funds) 1. Prepare a bank reconciliation statement in good form as of December 31t 2017.

Explanation / Answer

1. Bank reconciliation statement

2. Journal

Balance per books on Dec 31 $9930 Add deposits in transit 3835 Less outstanding checks -2824 Adjusted balance per books on Dec 31 $10941 Balance per bank on Dec 31 $11322 Less bank service charges -81 Add error in recording payment 100 Less NSF checks -400 Adjusted balance per books on Dec 31 $10941

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