Bank Reconciliation and EntriesThe cash account for American Medical Co. at April 30 indicated a balance of $10,405. The bank statement indicated a balance of $12,130 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:Checks outstanding totaled $4,370.A deposit of $4,550, representing receipts of April 30, had been made too late to appear on the bank statement.The bank collected $2,370 on a $2,240 note, including interest of $130.A check for $770 returned with the statement had been incorrectly recorded by American Medical Co. as $700. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account.A check drawn for $40 had been erroneously charged by the bank as $400.Bank service charges for April amounted to $35.Required:1. Prepare a bank reconciliation.

Bank Reconciliation Statement Bank reconciliation statement is a statement which reconciles bank…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Bank Reconciliation and Entries

The cash account for American Medical Co. at April 30 indicated a balance of $10,405. The bank statement indicated a balance of $12,130 on April 30. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:

Checks outstanding totaled $4,370.
A deposit of $4,550, representing receipts of April 30, had been made too late to appear on the bank statement.
The bank collected $2,370 on a $2,240 note, including interest of $130.
A check for $770 returned with the statement had been incorrectly recorded by American Medical Co. as $700. The check was for the payment of an obligation to Targhee Supply Co. for a purchase on account.
A check drawn for $40 had been erroneously charged by the bank as $400.
Bank service charges for April amounted to $35.

Required:

1. Prepare a bank reconciliation.

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